Let counties clear debts
The 47 counties have gained notoriety for failing to pay their pending bills, which continue to pile up. Suppliers and contractors are owed Sh156 billion with many of them on the verge of bankruptcy.
According to the Controller of Budget, this was the position as of December, with the suppliers and contractors in dire straits.
To be able to supply the counties, many businesses will have taken out commercial bank loans, which they are now unable to service. Some have had their properties auctioned to recover the loans. Others have had to cut back on operations as they hope to get paid someday but are not sure if and when that will happen, if at all.
This is why the push by senators to get counties to settle their pending bills is music to the ears of the owners of businesses that have been crippled after supplying the counties.
The Senate has approved a motion giving counties the go-ahead to clear all the verified pending bills. Nairobi tops the list with Sh107 billion, Kiambu Sh5.7 billion and Mombasa Sh3.92 billion. Senators want the bills fully paid by June next year.
The failure of counties to settle pending bills has adversely affected services and caused projects to stall and businesses to close, hampering economic growth. However, there is also rampant corruption and collusion between some county insiders and fake suppliers.
Therefore, only the verified pending bills should be paid and the fraudulent invoices rejected.
Unlike the counties, the national government has already established pending bills verification committees and set aside funds to clear the very old debts.
The devolved units should emulate this. Counties should prioritise the payment of the pending bills. It is the only way to help revive the affected businesses and revitalise the economy.
