Kisumu County hires private firm to recover Sh20 billion

Kisumu County governor Anyang' Nyong'o. He has hired over 100 debt collectors and are currently visiting estates and business premises in town. [File, Standard]

The county government has hired a debt collector to help it recover Sh20 billion owed by several commercial enterprises.

Most of the accumulated debts that date back to 2008 — 11 years ago — are unpaid land rates and unmapped revenue streams.

According to County Chief Finance Officer Erick Angwenyi, the county government has hired Collections Africa to map its revenue streams and collect all pending debts.

“It is true we have entered into a contract with the Collections Africa to help us collect the billions owed to us for years. They are currently moving round doing so,” he said

The Standard established that the firm had hired more than 100 debt collectors who are currently moving around the estates and business premises to collect debt.

Angwenyi also confirmed that the firm had recruited about 100 unemployed graduates, spread across the seven sub-counties, to collect debts on its behalf.

He said they would serve a one-year renewable contract and would be paid two per cent of the total debts collected.

The defaulters are required to clear their arrears before the end of the year after a notice to the public and land rate defaulters expired.

Governor Anyang’ Nyong’o issued a waiver to all defaulters, which expired three months ago.

But in the wake of the current development, the county government is considering issuing another waiver as the tax collectors begin work.

This is the first time the county has hired a debt collector, coming in the wake of the recent Auditor General’s report that raised queries on its declining revenue base.

According to the latest Auditor General 2017/2018 report, queries were raised over outstanding revenue emanating from defaulted property rates and county house rents.

The accuracy and completeness of the revenue for the year ended June 30, 2018, could not be confirmed for property rates and house rents and amounts streaming in.

The county had outstanding property rates of Sh9,089,779,053 which was not reflected in the statements of its assets and liabilities.

Prof Nyong’o said his administration had instituted tough austerity measures to meet its development targets by scaling up revenue collections.

Currently, the county’s budget is Sh9.2 billion, having cut down from the initial Sh9.6 billion due to shortfall in revenue targets.