The business community has renewed calls for county governments to clear pending bills owed to suppliers estimated to in excess of Sh100 billion.
Kenya National Chamber of Commerce and Industry (KNCCI) President Richard Ngatia said the issue, if unresolved soon, poses a great risk to the survival of many businesses that now have to contend with serious cash flow problems.
“We have been in continued consultations with both the national and county governments through the Council of Governors over the huge debt owed to contractors, who are also our members, and I’m sure this will be amicably resolved soon,” said Mr Ngatia.
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Mr Ngatia also urged the national government to regulate the influx of rice imports to protect local farmers.
“Towards the promotion of agriculture, there is need to tackle the growing problem of rice imports from Pakistan, which has become a threat to our main cash crop, rice,” said Ngatia (below).
“Ours is not to advocate for a total ban on rice imports. It is to have a level of regulation so that there’s room also for local quality Pishori rice to compete favourably.”
He was speaking in Kutus town at the weekend after visiting the Kirinyaga chapter of the chamber.
Despite the Government in June paying out pending bills to the tune of about Sh10 billion, businesses continue to struggle.
President Uhuru Kenyatta had directed ministries to settle all pending national government payments that do not have audit queries, on or before the end of the last financial year that ended on June 30.
The order may not have been practical given the amount of pending bill claims accumulated over the years and the time it would take to verify which ones are authentic.
A report by Genghis Capital puts pending bills at Sh400 billion, which have been accumulated by counties and the central government over the last few years.
Official estimates are, however, unavailable, with the Controller of Budget as of June this year putting counties’ and the national government’s debt to suppliers at more than Sh200 billion.
A Treasury report to the National Assembly showed that the State owes local traders about Sh29.3 billion, though suppliers insist total pending bills run into hundreds of billions.
“The latest Quarterly Economic and Budgetary Report cites Sh29.3 billion as the pending bill in FY2017/18. However, this amount does not consider cumulative pending bills of the previous years and the on-going bills in the current fiscal year,” said Churchill Ogutu, senior research analyst at Genghis Capital in an earlier analysis.