State, county pending bills rise to Sh794b

The total outstanding pending bills for both National and County Government as at September 30 this year amounts to Sh794.18 billion, a new report shows.

This is an increase of Sh193.78 billion compared to last year during the same period as the bills stood at Sh600.64 billion.

The amounts comprise Sh509.37 billion (64.1 per cent) for State Corporations, Sh121.19 billion (15.3 per cent) for MDAs and Sh163.62 billion (20.6 per cent) for County governments.

The State Corporations’ pending bills include payments due to contractors/projects, suppliers, unremitted statutory and other deductions, and pension arrears for Local Authorities Pension (LAP) Trust. The highest percentage of

The report from the Controller of Budget (COB) Margaret Nyakang’o notes that the State Corporations’ pending bills (Sh47.65 billion) is for pension arrears.

Reads the report: “The total outstanding National and County Government pending bills as of 30th September 2023 amounted to Kshs.794.18 billion, compared to Kshs.600.64 billion reported on 30th September 2022.”

Following the move Nyakang’o recommended that that eligible/verified pending bills are budgeted as a first charge in the budget, in accordance with Regulation 55 (2) (b) of the Public Finance Management (County Governments) Regulations, 2015, and Regulation 56(2)(b) of the Public Finance Management (National Government) Regulations 2015.

She also recommended that spending entities prepare payment plans for the verified pending bills, have them approved by an established Pending Bills Verification Committee, and follow enforcement mechanisms to ensure adherence to the approved payment plans.

She added: “Furthermore, the National Treasury is requested to establish measures to reduce the pending bills’ increases.”

The report also notes that the category of pending bills with the highest increase under State Corporations was the unremitted National Social Security Fund (NSSF) deductions that increased by 66.4 per cent from Sh137.06 million as of September 30, 2022 to Sh407.36 million as of September 30, 2023.
Reads the report: “Pending bills under the State Corporations recording a decrease was consumable and general supplies with a decline of 186.4 per cent from Kshs.87.32 billion as of 30th September 2022 to Kshs.30.49 billion as of 30th September 2023. State Corporations/State Owned Enterprises/SAGAs recorded a growth of 46.8 per cent in development expenditure pending bills.”

The report raised concerns that Ministry Departments and Agencies (MDAs’) pending bills are mainly historical pending bills comprising Sh86.63 billion (71.5 per cent) for recurrent expenditure and Sh34.57 billion (28.5 per cent) for development expenditure. In the first three months of FY 2023/24.

The amount paid for pending bills by MDAs was Sh 1.79 billion, comprising Sh 1.35 billion for recurrent and Kshs.436.24 million for development expenditure.

“There were no ineligible pending bills declared in the first three months of FY 2023/24. County governments’ pending bills comprised Sh129.15 billion (78.9 per cent) for recurrent and Sh34.47 billion (21.1 per cent) for the development expenditure.”

The increase in the pending bills comes hardly a month after National Treasury Cabinet Secretary Prof Njuguna Ndung’u unveiled the Pending Bills Verification Committee set to be chaired by former Auditor General Edward Ouko.

President William Ruto is on record saying the government owes suppliers at least Sh600 billion.
The committee has been tasked with auditing the government’s pending bills that have accrued between 2005 and 2022.

The Committee consists of the Attorney General as well as representatives from the State Department of Roads, the State Department of Public Works, the State Department of Housing and Urban Development and the Public Procurement Regulatory Authority.

It also has representatives from the Ethics and Anti-Corruption Commission, the Law Society of Kenya, the Institute of Engineers of Kenya and the Institute of Certified Public Accountants of Kenya