If the current regime exits without honouring its bills to suppliers, businessmen and women face a loss of over Ksh300 billion in pending bills.
This was revealed by the Association of Public Sector General Suppliers (APSGS), an association of businesspersons who supply the government with goods and services.
“Today businesses are owed close to Ksh.300 billion by various government entities including national government ministries, parastatals, commissions and independent offices,” noted APSGS Chairperson Peter Muriuki.
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The amount is owed by the National Government, County Governments, parastatals and public listed companies.
“We remain committed to not only ensuring that the government heeds to the call for prompt payment, but also to ensure that government officials who deliberately make payments hard are held liable personally,” added Mr Muriuki.
Data from the National Treasury to September 2021 shows that the national government’s pending bills amounted to Ksh423.2 billion.
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In most cases, when a new regime takes over power, they tend to push away all the pending bills as the suppliers count losses.
In most cases, some of the suppliers are left licking wounds paying loans they took from banks to make the supplies, while others lose their assets to lenders for defaulting.
Despite numerous directives requiring State Corporations to prioritize payment of pending bills, it has been noted that the level of compliance with these directives has been very low.
Data from the 2018 World Bank Enterprise Survey shows the existence of pending bills by the Government, with about 12 percent of the firms surveyed reporting that they had contracts with the Government which were late for payment.
The World Bank Report on the state of Kenya’s Economy indicates that the total value of pending bills had increased from 0.9 percent of GDP in the 2015/16 financial year to 1.6 percent in the 2017/18 financial year.
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