County governments settled Sh10.5 billion pending bills in the six months ended December 2023, handing relief to businesses strained by cash flow.
At least 43 counties reported spending between Sh17 million and Sh1.8 billion each on payments to suppliers during the six months, even as some continued with verification, the latest report by the Controller of Budget (COB) shows.
By the end of December, the COB report shows, the stock of pending bills for all 47 counties dropped to Sh156.3 billion from Sh164.7 billion when July started.
“During the period under review, counties reported outstanding pending bills amounting to Sh156.34 billion and comprised of Sh154.86 billion by the county executive and Sh1.48 billion for the county assemblies.
“Analysis of the pending bills shows that Nairobi City County accounted for 68.5 percent of the stock of pending bills at Sh107.04 billion. Other counties with a high level of pending bills are Kiambu (Sh5.71 billion), Mombasa (Sh3.92 billion), Machakos (Sh3.03 billion), Mandera (Sh2.3 billion) and Busia (Sh2.29 billion),” COB Margaret Nyakang’o reported.
The COB keeps citing high pending bills as one of the key challenges the national government faces and urges them to settle eligible pending bills as a first charge on the budget as the law requires.
During the six months, Kilifi County spent Sh1.77 billion to settle the bills. The spending was three times more than what any other county spent on pending bills during the period.
Turkana followed with Sh564.4 million while Tana River spent Sh534.36 million, and Murang’a closed the list of four counties that spent more than Sh500 million, having spent Sh512.78 million.
Some four other counties, being Embu, Migori, Nairobi, and Kisumu, spent between Sh400 million and Sh490 million each settling the pending bills.
“Elgeyo Marakwet and Baringo Counties had the lowest outstanding pending bills at Sh2.79 million and Sh4.55 million, respectively,” the COB stated, further reporting that some four counties — Kisii, Nandi, Lamu, and Wajir-- did not report any spending on settlement of the pending bills during the six months.
“At the beginning of financial year 2023/24, the county executive reported a stock of pending bills amounting to Sh1.19 billion, comprising Sh287.35 million for recurrent expenditure and Sh903.56 million for development activities. In the first half of the financial year 2023/24, the county executive did not report any payment towards pending bills. Therefore, as of December 31, 2023, the outstanding amount was Sh1.19 billion. The outstanding pending bills for the county assembly were Sh52.97 million as of December 31, 2023,” she said on Kisii County.
In Nandi, while no pending bills were settled during the six months, the county revised the stock from the Sh177.9 million that was reported by the end of June 2023, to Sh285.9 million
“At the beginning of the financial year 2023/24, the County Executive reported a stock of pending bills amounting to Sh5.38 billion which were not disaggregated. During the period, the County verified the pending bills and the report of the Verification Committee revealed the stock of eligible pending bills as Sh1.65 billion excluding penalties and interest amounting to Sh520.1 million,” the report on Wajir County stated.
The growing spending by counties to settle pending bills is in the context of a series of alarms raised by watchdogs and business bodies, over the pain they have caused to businesses across the country, by denying them cash flows.
Different reports have also linked the growing cases of loan defaults in the banking sector to the pending bills that have paralysed businesses across different sectors.
