Contractors and suppliers who did business with the Laikipia county government are staring at Sh1 billion loss after the current administration rejected claims inherited from the previous one.
The development comes after governor Joshua Irungu-led administration said only Sh1.2 billion out of the Sh2.2 billion inherited from the previous regime would be honoured.
Auditor-General Nancy Gathungu’s report for the financial year ended June 2020 revealed that the county government had pending bills dating back as far as the financial year ended June 2016.
Appearing before the Senate County Public Accounts Committee on Wednesday, Mr Irungu said after assuming office last year, he established a county pending bills committee, which flagged Sh1 billion pending bills as ineligible.
He said an earlier audit by the Auditor-General put the eligible pending bills at Sh822 million.
“I inherited a pending bills debt worth Sh2.2 billion from the previous government but a report of the committee only found Sh1.2 billion as eligible to be paid. I will only pay those,” said Mr Irungu.
He said when he left office in 2017, the pending bills were less than Sh400 million but that has since ballooned to Sh2.2 billion in only five years.
Consequently, he said, it would be difficult for him to pay for work that does not have proper documentation or is incomplete.
“I am ready to pay the eligible pending bills but the other ones will have to wait as their documentation must be verified before any payment is done,” he said.
The governor observed that apart from incomplete documentation; delays in the completion of projects, failure by county governments to meet their source revenue targets and delays by the National Treasury to release the exchequer are fueling pending bills problems in counties.
The committee’s chairperson Senator Moses Kajwang’, however, said a contractor or supplier should not suffer because of mishandling of paperwork by officers.
He said most of the time, the contractors or suppliers have no problems in cases of ineligible pending bills.
“Contractors cannot do it alone. It is a long chain to have ineligible pending bills of Sh1 billion. Let no one suffer because of a change of administration,” he said.
“It is not enough to just say it is ineligible but tell us the measures taken to bring this problem to an end.”
Mr Kajwang’ said the law states that pending bills should be the first charge in any budget and it is time counties stop the circus surrounding the payment of pending bills.
Read: Laikipia county plans to float Sh1.2b year bond at 1.2%
“This pending bills issue has more than meets the eye. Some do business today and are paid tomorrow but for others, they have to part with something small to get paid,” said Tharaka Nithi Senator Mwenda Gataya.
