Kenya, like many countries, has been grappling with the issue of pending bills for a long time.
These unresolved financial obligations, often owed by government entities to suppliers and contractors, have become a significant concern.
However, what makes Kenya’s pending bills unique compared to other countries is that ours are multifaceted and riddled with a lot of interests from powerful forces.
According to figures released by the Controller of Budget this week, the situation has not changed as the suppliers are still owed billions for services rendered.
In the new report by the Controller of Budget the devolved units total pending bills increased to Sh164.76 billion from Sh153.02 billion in 2022 despite some of them using less than half of the development budget.
In total the outstanding pending bills for both national and county governments as of June 30, 2023 stood at Sh727.74 billion compared to Sh685.62 billion reported in a similar period in 2022.
It is no doubt that the government's failure to fulfil its obligations has had a detrimental impact on both supplier businesses and the families they support.
Additionally, this situation has led to significant job losses, which is ironic given that state procurement is expected to have a positive, rather than negative, effect.
Delays in settling pending bills have led to the deterioration of cash flows of many individuals and firms, especially those who tapped bank loans to do business.
However, the move to audit the pending bills is welcome move because previous reports have revealed that part of the bills owed by the governments are a result of collusion by insiders.
We cannot however fully lay the blame on counties. Like in the last financial year they received money when the year was coming to a close. What they would do in that instance is they first of all pay salaries.
In what appeared like a way forward towards providing a solution to the pending bills issue the government has been pushing for all MDAs to embrace accrual accounting, a system which records revenues when earned and expenses when incurred rather than when payments are made.
The writer is TISA programme manager
