Nairobi approves Sh12b budget to settle pending bills

Nairobi City hall offices.[File, Standard]

Nairobi County Assembly has approved a second Sh12 billion supplementary budget for pending bills and statutory payments.  

The funds will be utilised by both City Hall executive and the Nairobi Metropolitan Services (NMS) to settle debt obligations audited by the Auditor General's office.

In the first supplementary budget passed in April, Sh1.3 billion was set aside for the Major General Mohammed Badi-lead team to pay contractors and suppliers. 

County Assembly Budget and Appropriations Committee chairperson Robert Mbatia said the second supplementary budget was drafted based on the directive by President Uhuru Kenyatta to ensure suppliers pay is not delayed.

“The second supplementary estimates of Sh12 billion will settle part of recurrent pending bills and amounts owed to development contractors,” said Mbatia.

Notably, Sh4.4 billion has been allocated towards settling Kenya Commercial Bank's (KCB) loan. 

Another Sh1.2 billion will pay Kenya Revenue Authority (KRA) debt while Sh381 million has been allocated to NSSF.

Mbatia also said re-allocations had been made across various votes in line with the provisions of Section 135 and 154 of the Public Finance Management Act (PFM) 2012, to make resources available for the payments.

The changes saw NMS budget reduced from Sh23.2 billion to Sh11.2 billion. 

The committee further noted that the second supplementary budget was necessary to allow expenditure of the funds before the lapse of the current 2020/21 financial year on June 30.

“The committee and indeed the County Assembly has been a strong crusader of the need for county government and the latter–day brother, NMS, to prioritise settlement of pending bills to also bolster the county’s credit score, while also guaranteeing that those who do business or work with City County don’t regret the decision,” Mbatia added.

During debate, Kilimani MCA Moses Ogeto, however opposed the budget, saying committee had slashed NMS funds and this would hamper development.

“This is a skewed presentation and I have never seen such a budget estimate paper before. Denying NMS funds is unreasonable," said Ogeto. 

Majority leader Abdi Hassan however said the supplementary budget was in order given that it had been presented before the house from NMS via the executive.

Eastleigh North MCA Osman Adow said passage of the budget would ensure pending bills are paid and revive stalled projects. Roysambu MCA Peter Warutere said the funds will reduce the huge pending bills.

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