Nairobi Governor Johnson Sakaja faces a huge task in his bid to implement his rosy manifesto for city residents, as he will first have to tackle a mountain of pending bills that hit Sh99 billion in June.
The county has been unable to pay contractors and suppliers as it went through a series of changes in leadership, with mismanagement at City Hall nearly causing the county to choke under debts.
Between July 2021 and June 2022, the county accumulated an extra Sh14 billion in pending bills, on top of the Sh85.7 billion as of the end of June 2021, the Controller of Budget (COB) has disclosed. This means that, on average, over the past financial year the county accumulated Sh1.2 billion in pending bills monthly.
“At the beginning of FY 2021/22, the County failed to prepare a satisfactory payment plan for settling the pending bills in the current financial year,” COB Margaret Nyakang’o has said.
“During the period under review, the County Treasury did not provide a report on the settlement of pending bills as of June 30, 2022.”
In her report on counties’ budget implementation in the 2021/22 financial year, Ms Nyakang’o reported that by June 2022, pending bills in Nairobi County constituted 65 per cent of total bills by all the 47 counties.
“As of June 30, 2022, counties reported accumulated pending bills amounting to Sh153.02 billion, [comprising] Sh151.68 billion by the County Executive and Sh1.34 billion by the County Assemblies.
Entire stock of pending bills
Outstanding pending bills by Nairobi City County accounted for 64.7 per cent of the entire stock of pending bills at Sh99.06 billion,” the report stated.
The pending bills of counties this year are also a huge increase from the Sh96 billion reported by June last year and imply that the counties accumulated an average of Sh4.7 billion monthly, cumulatively.
Of the bills, Sh151 billion is owed by county executives, most of which have had their governors lose seats or retire after serving the constitutional two terms, and will form a new headache for incoming governors as they balance them with rosy promises to county residents.
Other counties recorded to have huge pending bills are Mombasa at Sh5.87 billion and Kiambu at Sh5.23 billion.
“To address the identified challenges, the Controller of Budget advises county governments to settle pending bills as a first charge in the FY 2022/23 budget in line with Regulation 41 (2) of the Public Finance Management (County Governments) 2015,” the COB stated.
The report also observed an alarming situation where of the pending bills, a total of Sh22 billion relate to recurrent activities, meaning some counties are going without paying workers their salaries and settling other expenditures classified under recurrent budget.
In Mombasa, for instance, of the Sh5 billion in pending bills, Sh3.9 billion owed by the county executive relates to recurrent activities and Sh1.2 billion to development.
Counties with the least pending bills are Lamu (Sh4.3 million), Mandera (Sh5 million) and Elgeyo Marakwet (Sh14.3 million).