The debt stands at Sh58 billion even though the national Treasury puts it at Sh142 billion, with most of it being historical loans.
Statutory debts amount to Sh27.7 billion with the Kenya Revenue Authority’s Pay As You Earn, including penalties, amounting to Sh4.2 billion; withholding Tax and VAT Sh226 million; NSSF Sh470 million and Laptrust Sh12 billion.
Debt–riddled Nairobi County is looking for an expert to help it deal with spiralling bills.
In a notice in the daily papers on Wednesday, City Hall said it was seeking applicants for the position of “director of debt management” who will be expected to “formulate, review and implement public debt management policies of the county”.
“The debt management director is expected to prepare and implement the government’s borrowing plan including servicing of outstanding debt,” said the county public service board.
According to Charles Kerich, the acting Nairobi county executive for finance and economic planning, the debt stands at Sh58 billion even though the national Treasury puts it at Sh142 billion, with most of it being historical loans.
Statutory debts amount to Sh27.7 billion with the Kenya Revenue Authority’s Pay As You Earn, including penalties, amounting to Sh4.2 billion; withholding Tax and VAT Sh226 million; NSSF Sh470 million and Laptrust Sh12 billion.
“The Mike Mbuvi Sonko administration inherited an unbelievably large debt portfolio of Sh58 billion. With average annual collections at Sh12 billion, it would take the entire four-and-a-half years remaining in the Sonko administration to pay off the debt,” Mr Kerich said recently in a commentary.
Nairobi accounted for 62 per cent of the Sh96.4 billion worth of debts that the 47 counties accumulated in the 2016/2017 financial year, official data shows.
Controller of Budget Agnes Odhiambo in January this year told Parliament that pending bills had grown further in the last financial year to reach Sh99.2 billion.
She called for an audit of the swelling bills by county governments. The debts have been blamed for crippling enterprises that are doing business with the devolved units.
Mr Kerich said the county had ramped up efforts to pay up through an “aggressive” revenue collection and expansion of the revenue base strategy as well as negotiations with the national government to pay what it owes the county government in order to offset some of the county’s bills and a pragmatic budget that does not create more debts.
“Nairobi will be salvaged by a two-pronged strategy of collecting to its revenue potential while at the same time implementing a practical budget based on realistic revenue forecasts,” he said.
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