Editorials

Public entities should settle all pending bills

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National Treasury building. FILE PHOTO | NMG

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Summary

  • The matter of pending bills in the public sector procurement system now sounds like a broken record.
  • The Treasury has been singing the same tune for as long as the government ministries, agencies and parastatals have owed suppliers billions of shillings in unpaid bills.
  • As of last September, the public procurement entities owed to suppliers and contractors Sh346.2 billion.

The matter of pending bills in the public sector procurement system now sounds like a broken record.

The Treasury has been singing the same tune for as long as the government ministries, agencies and parastatals have owed suppliers billions of shillings in unpaid bills.

As of last September, the public procurement entities owed to suppliers and contractors Sh346.2 billion.

The Treasury has issued several directives for the State corporations, counties and agencies to clear the debts to no avail.

The latest report that the entities have defied the directive to settle the pending bills calls for a change in tack to make them pay up.

Businesses have borne the brunt of the pending bills, not to mention the adverse economic effects of the Covid-19 pandemic. Some of the entrepreneurs are not likely to recover, given that they might have lost valuable assets to the auctioneer’s hammer on defaulting on loans they secured to supply goods and services to the public institutions.

We urge the government to take stern action against public officers who ignore its directives. The failure to pay is not only callous but also gross dereliction of duty. This should be punished under the law and relevant regulations.

The pending bills also expose the public entities to litigation for the breach of contract, especially in cases involving payments that have not been settled for years since procurement of goods and services.

The debt also flies in the face of government efforts to spur private sector growth, especially the promotion of small and medium enterprises (SMEs).

Timely payment of the pending bills would help to improve cash flow among the SMEs. In turn, the businesses would sustain jobs and invest further, which is good for Kenya’s socio-economic wellness.

We also urge the State agencies, devolved units and parastatals that owe businesses to fast-track the payments as a matter of urgency.

The matter of pending bills in the public sector procurement system now sounds like a broken record.

The Treasury has been singing the same tune for as long as the government ministries, agencies and parastatals have owed suppliers billions of shillings in unpaid bills.

As of last September, the public procurement entities owed to suppliers and contractors Sh346.2 billion.

The Treasury has issued several directives for the State corporations, counties and agencies to clear the debts to no avail.

The latest report that the entities have defied the directive to settle the pending bills calls for a change in tack to make them pay up.

Businesses have borne the brunt of the pending bills, not to mention the adverse economic effects of the Covid-19 pandemic. Some of the entrepreneurs are not likely to recover, given that they might have lost valuable assets to the auctioneer’s hammer on defaulting on loans they secured to supply goods and services to the public institutions.

We urge the government to take stern action against public officers who ignore its directives. The failure to pay is not only callous but also gross dereliction of duty. This should be punished under the law and relevant regulations.

The pending bills also expose the public entities to litigation for the breach of contract, especially in cases involving payments that have not been settled for years since procurement of goods and services.

The debt also flies in the face of government efforts to spur private sector growth, especially the promotion of small and medium enterprises (SMEs).

Timely payment of the pending bills would help to improve cash flow among the SMEs. In turn, the businesses would sustain jobs and invest further, which is good for Kenya’s socio-economic wellness.

We also urge the State agencies, devolved units and parastatals that owe businesses to fast-track the payments as a matter of urgency.