Nairobi County government has suffered a setback after the Controller of Budget declined its request to approve Sh1 billion in pending bills owed to legal firms that served it.
COB Margaret Nyakang’o directed CEC for Finance Charles Kerich to reveal why the county failed to provide the payment plan, which would enable the matching of individual payees to the requisition.
In a letter dated June 27, 2023, she requested county executive committee member for finance Kerich to provide clarifications on the exchequer requisition for legal fees totalling Sh1,068,277,305.
The COB also noted that there was difficulty in matching the proposed payments with the report of the pending bill previously presented to her office.
As a result, Nyakang’o directed the county treasury to provide documents including the legal fees.
“The status of each court case should be provided, including copies of judgments where given,” she added.
The CoB also wants the county to submit the criteria used to select the payments and the application of the “recommended first-in first-out method” in identifying the bills.
The Finance CEC was also tasked to give information on whether the proposed payment is a partial or final payment to the legal firms.
Looking at the requisition for development expenditure of Sh378,860,686, Nyakang’o revealed that the schedule of 19 firms to be paid lacked invoice dates.
"This makes it difficult to determine if they are pending bills or related to works done and invoiced in the current financial year," she said.
In addition, the COB recommended a revision of the schedule to include invoice dates and attached copies of payment vouchers for the 19 firms.
The payment of legal fees has been a thorn in the flesh for previous administrations at City Hall.
Nairobi County owes contractors and suppliers more than Sh100 billion in pending bills.
Many are however asking why City Hall prioritised the payment to the legal firms while other bills are long overdue.
The issue has put Governor Johnson Sakaja-led administration on the spot with concerns over the modality used to identify the law firms.
In documents to be filed at the High Court, Rodney Wesonga & Mwangi Natia Advocates accuse City Hall of hastily planning to make the payment without revealing the criteria used to identify the law firms.
"The applicant has since learnt that the National Treasury is in the process of disbursing some funds to the Nairobi County government for purposes of sorting pending bills and the applicant has further learnt that the first respondent has approved to pay around Sh2 billion to less than 15 law firms," read part of the suit papers seen by the Star.
"It is not clear which modality the county used to settle on paying the said 15 law applicant firm and other firms that have equally provided legal services to the Nairobi County government."
They also seek to brief the court that the county has ignored several written requests to explain the criteria used to identify the law firms.
The aggrieved law firms have said City Hall's decision to pay the law firms is discriminatory as the companies are “politically-connected".
