• Move comes even after Parliament rejected Yatani’s bid to stop the funds for the initial 15 counties cited for non-payment of pending bills.
• CS wants affected governors to furnish his office with their bill repayment plan, amounts and details of the payee, description of the work done or goods provided.
The government is going for more counties flouting President Uhuru Kenyatta’s pending bills directive, a move likely to plunge counties into more financial crises.
Treasury has indicated it will withhold disbursement of cash to another 20 counties bringing the number of devolved units unable to get cash over unpaid pending bills to 35.
This now means that only a paltry eight out of the 47 counties are eligible for disbursement of cash from the exchequer.
Even as counties cry foul, the move is, however, music to the ears of thousands of contractors and suppliers to the counties whose payments are stuck pushing them out of the business.
The decision communicated in a letter dated December 5 by Treasury CS Ukur Yatani to the affected counties risks stalling service delivery in the counties at a time a number of county employees are yet to get their November salaries.
The move comes even after Parliament rejected Yatani’s bid to stop the funds for the initial 15 counties cited for non-payment of pending bills running into billions of shillings.
But acting in defiance of the House warning, Yatani–who is keen on implementing President Kenyatta’s directive on pending bills, struck again–this time red-flagging 20 counties he claimed are still not paying contractors and suppliers.
The government’s failure to pay contractors and suppliers has been blamed for the economy’s dismal performance as the government holds billions in bills exposing contractors to auction due to un-serviced loans.
The majority of the contractors and suppliers took expensive bank loans and have been unable to pay back.
Joining the list of 15 are Kisumu, Taita Taveta, Turkana, Meru, Samburu, Nakuru, Murang’a, Mandera, Kisii, Busia, Marsabit, Bungoma, Siaya, Trans Nzoia, Kitui, West Pokot, Embu, Kakamega, Wajir and Lamu counties.
Cumulatively, counties owed their suppliers Sh64.2 billion as of October 28.
“Controller of Budget report on the status of payment of pending bills by your county government indicates that you have not complied with the directive on the settlement of county government’s pending bills though you have cleared some as at November 30,” Yatani said in the letter obtained by the Star.
The Intergovernmental Budget and Economic Council chaired by DP William Ruto had resolved that county governments would pay eligible pending bills on a priority basis as a first charge on the County Revenue Fund by the end of 2019-20.
The Public Finance Management Act gives the CS the authority to stop the transfer of funds to state organs or any other entity.
The CS further wants the affected governors to furnish his office with their bill repayment plan, ages of the pending bills, amounts and details of the payee, description of the work done or goods provided, contract amount, outstanding amount and amount to be paid and the proposed date of settlement.
“...future disbursement will be subject to provision of the required information and payments in line with your repayment plan. Failure to settle all the eligible pending bills may result in the National Treasury invoking the Constitution to stop transfer of funds to your county government,” the letter reads.
The letter was copied to head of Public Service Joseph Kinyua, Attorney General Paul Kihara, Devolution CS Eugene Wamalwa and Council of Governors chairman Wycliffe Oparanya.
The initial counties included Migori (Sh970 million), Tharaka Nithi (Sh921 billion), Bomet (Sh893 million), Kirinyaga (Sh1.05 billion), Nandi (Sh1.12 billion), Mombasa (Sh4.07 billion), Kiambu (Sh1.56 billion), Garissa (Sh1.57 billion) and Baringo (Sh35 million).
Others are Narok Sh1.8 billion, Machakos (Sh1.1 billion), Nairobi (Sh21 billion), Vihiga (Sh1.8 billion), Isiolo (Sh1.09 billion) and Tana River (Sh1.09 billion).
On Tuesday, CoG protested the move to withhold funds for the additional 20 counties saying it will make service delivery almost impossible.
Oparanya accused Yatani of not taking into account that some of the bills were inherited from the defunct local governments.
“Further, we note that all the 47 county governments have not received their November monthly disbursement of Sh31.6 billion which was due on November 15. This has greatly affected their operations,” Oparanya said in a statement to newsrooms.
Edited by R.Wamochie