Jitters as internal memo on pending bills pay sparks panic

Controller of Budget Margaret Nyakang’o says all payments have been put on hold. [Robert Kiplagat, Standard]

Businesses are panicking after reports appeared showing that the government might have reneged on its promise to clear some of pending bills.

An internal memo from the Controller of Budget Margaret Nyakang’o informed her staff that all payments had been ceased as the government moved to commit all its resources in the fight against coronavirus disease.

“This is to inform you that the National Treasury and Planning has put on hold all commitments, payments and claims as the country assesses the resource requirements for Covid-19 interventions,” said Ms Nyakang’o in the memo.

It was not immediately clear whether the government had backtracked on its promise to pay pending bills worth Sh13 billion in what is aimed at boosting the cash flow of businesses affected by the pandemic.

Attempts to reach Principal Secretary Julius Muia were unsuccessful. He had not responded to our message by the time of going to press.

A source at Treasury told The Standard that even before the memo, the government had already closed the Integrated Financial Management Information System, an e-procurement platform that enables different State corporations to transact business.

He could not, however, confirm whether payment of pending bills had also been stopped.

On March 25, President Uhuru Kenyatta said the government would at least pay Sh13 billion verified pending bills within three weeks since that date.

“Similarly, and to improve liquidity in the economy and ensure businesses remain afloat by enhancing their cash flows, the private sector is also encouraged to clear all outstanding payments among themselves within three weeks from the date hereof,” said Mr Kenyatta in his speech. Treasury has proposed a freeze on all development projects and the cash diverted to fight coronavirus.

Among the projects to be affected are those under President Kenyatta’s Big Four Agenda.