Treasury CS Ndung’u reveals Gov't pending bills have risen to Ksh.696.9 billion

Treasury Cabinet Secretary Prof. Njuguna Ndung’u has warned that the pending bills of the national and county governments had risen to Ksh.696.9 billion by the end of March 2023.

The total outstanding pending bills by the national government as of March 31, 2023 stood at Ksh.537.2 billion.

This comprised of Ksh.450 billion for State corporations, semi autonomous government agencies and Ksh.79.3 billion for ministries, departments and agencies.

During the same period, county governments reported pending bills of Ksh.159.7 billion.

In the numbers presented to the National Assembly in his debut budget speech, CS Ndung’u said the spike has had adverse impacts on micro, small and medium enterprises, with many struggling to meet their financial obligations.

The spike in pending bills is pushing a lot of businesses into defaults and in order to get the suppliers off the auctioneer’s noose, Treasury has reached out to the Cabinet recommending the establishment of an inter-ministerial committee to carry out a thorough analysis of the stock of all pending bills and advice on how the bills will be settled.

Once the outstanding pending bills are cleared by the verification committee, Treasury will direct all entities to ensure strict adherence to the Public Finance Management Act 2012 and clear pending bills as a first charge on the budget of the concerned entity in the subsequent financial years.

Pending bills have continued to rise despite various circulars by the past and current regimes directing ministries, parastatals, and counties to prioritise payment of verified arrears in their budgets.

Part of the issues that have thwarted previous efforts to clear pending bills include the exaggeration of revenue by various entities and the diversion of funds meant to clear the debt.

The Treasury has also been put on the spot severally for late disbursement of funds meant to clear pending pills as well as Integrated Financial Management Systems-related (IFMIS) challenges that have also led to the accumulation of the bills.

On Saturday, the Treasury released Ksh.11.1 billion to the National Health Insurance Fund (NHIF) to settle pending bills owed to hospitals,  in a move that is expected to resolve the impasse that saw thousands of patients blocked from accessing critical health services.

CS Njuguna likewise called for strengthening of checks and balances to ensure that both levels of government are not in debt.