Pending bills claims made under the ongoing verification exercise have climbed by Sh2.4 billion reaching Sh664.7 billion with the number of claimants topping 114,376.
The disclosures made last week by the National Treasury reveal a growth in the number of claimants from 94,997 in June even as the value of claims remains largely unchanged from 662.3 billion in the same period.
The rise in claimants comes ahead of the release of an interim report by the Pending Bills Verification Committee next month.
“The committee has so far received pending bills claims valued at Sh664.7 billion from 114,376 claimants and verification is ongoing. The committee is expected to release its interim report in October 2024,” the National Treasury noted.
The pending bills verification committee was inaugurated in November last year and tasked with analysing all stocks of pending bills for the period July 1, 2005 to June 30 2022.
The committee was also tasked with formulating measures to stop the accumulation of pending bills going forward.
Pending bills have continued to rise despite the government renewed focus on clearing the arrears with the National Treasury directing ministries and State departments to treat the bills as a first charge.
Tough talk
The national government’s outstanding pending bills rose by Sh29.4 billion in three months to June 2024 despite the Kenya Kwanza administration tough talk on eliminating the sticky arrears.
The stock of national government pending bills hit Sh516.3 billion in June 2024 from Sh486.9 billion in March.
The outstanding national government pending bills comprised Sh379.8 billion in arrears by State corporations and Sh136.5 billion owed by ministries, State departments and other government agencies.
Counties meanwhile reported outstanding pending bills of Sh181.98 billion as at June 30, 2024 consisting of Sh179.87 billion for county executives and Sh2.11 billion for the County Assemblies.
The National Treasury is banking on a shift to accrual basis accounting from a cash basis criterion to significantly reduce the occurrence of pending bills.
Accrual accounting records revenue and expenses when transactions occur but before the money is received and dispensed while the cash basis method records revenue and expenses when cash is received or disbursed.
“Currently the national government MDAs and county governments do not recognize pending bills as payables in their balance sheet since they are on a cash-basis of accounting. This means that all pending bills are maintained outside the integrated financial management system thus making them difficult to track and verify,” Treasury Principal Secretary Dr Chris Kiptoo noted previously.
The National Treasury says it is developing a comprehensive strategy to clear outstanding stock of verified pending bills of the national government over the medium term.
The strategy involves addressing deficiencies and lapses that resulted in the accumulation of pending bills.
All ministries and State departments (MDAs) are expected to clear all the expenditure carryovers from the previous financial year as a first charge before paying any commitments in the current 2024/25 fiscal year.
