Dark cloud of pending bills returns to haunt Nairobi Finance nominee

The dark cloud of “pending bills” has returned to haunt Nairobi chief officer for Finance nominee Asha Abdi.

While appearing before the Finance Committee during the vetting process on Thursday, she was tasked to explain how she will address the county’s huge pending bills.

"Pending bills remain a big challenge and the reality is that if our government will not intervene, they will pile up to a point they will never be paid,” Asha said.

City Hall is currently choking in debt after revelations that Governor Johnson Sakaja has inherited Sh99.06 billion from his predecessors Ann Kananu and the Nairobi Metropolitan Service.

The latest data from the Controller of Budget shows that Nairobi’s pending bills jumped to Sh99.06 billion for the year ended June 2022, from Sh54.32 billion in the 2020-21 financial year.

During her vetting, Budget vice chairperson Emily Oduor tasked the nominee to explain why during her tenure in Mombasa, the county had a huge pending bill.

In the 2017-18 Financial Year, according to the Auditor General, former governor Hassan Joho’s administration had Sh3.7 billion as total pending bills, but the Mombasa county government submitted a figure of Sh5.3 billion

The Auditor General said only Sh3.5 billion, out of Sh5.3 billion was eligible

However, the county revealed that the huge amount of pending bills is made up of the pension fund and bills inherited from the defunct Mombasa municipal council

In her defence, Asha said most counties were struggling to handle most of the pending bills as they had been inherited from the defunct Mombasa municipal council

She also said that most of the money goes to paying salaries and the county Assembly thus a struggle to divide their resources.

“For instance, she said that in Mombasa county out of Sh7 billion it gets from the national government, Sh6 billion goes to payment of salaries with the remaining Sh1 billion left for county Assembly,”

"Even if we try how hard to clear the pending bills, to some extent it will be impossible. How will you explain a county like Mombasa," Asha posed?

Non-adherence to procurement plans was also another big challenge she mentioned, saying it was playing a big role in piling up unpaid arrears.

However, the nominee issued a raft of proposals to address the mounting pending bills that have affected most counties.

If given a chance, Asha said she will initiate the fast-tracking of the exchequer release from the national government which will put the county in a better position to pay arrears.

She also suggest that a debt swap was one way that the county could consider reducing the pending bills.

Asha reckoned that debt swap is a key plank of Nairobi to reduce its liabilities amid a perennial cash crunch and high wage bill.

Last year, City Hall opened talks with Kenya Power and National Social Security Fund (NSSF) to swap a Sh1.07 billion debt with un-paid rates in efforts aimed at avoiding legal tussles.

The county disclosed that it was to negotiate with Kenya Power to swap a Sh691.58 million electricity bill with money due for wayleave charges from the power distributor.

In addition, the nominee also disclosed that an audit should be conducted to establish the legitimacy of the pending bills.

“Nairobi’s pending bills should be audited to reveal the legit ones. It is almost unbelievable that a county can have Sh99 billion worth of pending bills “ Asha said.

“The pending bills should be reviewed case by case before any payment is done."

County chief officers are authorised to delegate power and are answerable to the county executive committee member in their respective dockets.

Their key functions include the day-to-day administration of departmental activities and the provision of strategic policy direction for effective service delivery within the departments they are assigned to.

They also implement policies and programmes within departments.