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Economy

Treasury plans sixth bond in five months for road repairs

Acting Treasury Secretary Ukur Yatani. FILE
Acting Treasury Secretary Ukur Yatani. FILE PHOTO | NMG 

The Treasury is heading back to the domestic market to raise billions of shillings for roads repair following damage in recent heavy rainfall.

Acting Treasury Secretary Ukur Yatani told Parliament on Tuesday that the government will be floating an infrastructure bond of unspecified amount of cash.

The Treasury has already floated five bonds since this financial year began on July 1. The debt instruments floated either for budget support or as infrastructure bonds include the Sh50 billion 10-year bond which closed on Tuesday. Others include the Sh60 billion 16-year bond floated last month and a September tap sale.

Mr Yatani said that out of the Sh96.1 billion that the government owes contractors and suppliers, Sh76 billion is for roads works undertaken in last financial year.

The pending bills include Sh2.6 billion owed to youth, women and the disabled who supplied government under the Access of Government Procurement Opportunities (AGPO).

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“We have a plan and moving forward, we intend to come up with a roads bond. There were challenges in the regulatory framework. The amendments have been forwarded to the Attorney-General and in the next three days, it will be forwarded to this House for enactment. This will get us clear framework to finance roads construction,” Mr Yatani said.

He was responding to questions by Transport committee chairperson David Pkosing who wanted to know the progress made by the Treasury in implementing a House recommendation for establishment of a roads and not infrastructure bond.

Mr Yatani said ministries, departments and agencies (MDAs) of government reported pending bills relating to prior years amounting to Sh82.7 billion.

He said effective Wednesday, the Treasury is likely to suspend expenditure by MDA apart of salaries until they pay pending bills.

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