Mounting debt, MCA loans worry new North Rift County bosses

Nandi Governor Stephen Sang. FILE PHOTO | ROBERT NGUGI | NMG
Nandi Governor Stephen Sang. FILE PHOTO | ROBERT NGUGI | NMG 

New governors in the North Rift region have their jobs cut out as they deal with huge unsettled debts and pending bills inherited from their predecessors.

They face the daunting task of overseeing payments to creditors as well as recovery of millions in loans advanced to Members of County (MCAs) and Executives that are no longer being serviced.

Some of the devolved units have already initiated the process of determining their precise level of debt in order to settle 'genuine’ outstanding expenses as others contemplate legal action against officers that are no longer paying their debts.

In Nandi County, Governor Stephen Sang has constituted a taskforce to audit what the devolved unit is owed and what it owes to creditors.

"The process will ensure that only the genuine and justified debts are settled after systematic verification," said Mr Sang.

Acting County Secretary, Francis Sang, has issued a notice to individuals and firms which supplied goods and services to the past regime.

“All those who the county government owes should present memorandum detailing what service they offered or which goods they supplied with supporting evidence,” he said today.

Row with contractors

The move comes as a row brews between the county government and contractors over pending bills amounting to over Sh460 million.

The contractors have threatened to move to court to have the money paid in the next one week for work done in the 2015/2016 financial year.

They argue that banks have threatened to auction their property to recover loans they secured to fund the projects.

Some of the pending projects in the county include construction of the governor’s office and a revamp of the Kipchoge Keino Stadium.

According to a report by Auditor-General Edward Ouko, the initial cost of the governor’s office was estimated at Sh103.4 million for a two-storey building, but an additional floor was later approved at a cost of Sh21.2 million.

Construction works began in February 2014 and was to be completed by February 2015 but it remains unfinished.

“The County management has not explained if and when the project will be complete and when the stakeholders will get value for their resource,” stated Mr Ouko's report released on 30th June 2015.

Governor Sang, who took over from Cleophas Lagat, now wants the national government to take over construction of the multi-million shilling Kipchoge Keino Stadium which was initiated by his predecessor four years ago.

“We will be engaging the national government to take over this project while we utilise funds meant for its completion to put in place a State of the Art sports academy for the benefit of our athletes,” Mr Sang said recently.

Lost money

Other North Rift counties that risk losing millions of shillings include Elgeyo Marakwet and Uasin Gishu, with the Auditor General's office having previously expressed concern over how funds will be recovered.

The latest audit report by Mr Ouko indicates that Members of the Elgeyo Marakwet County Assembly and Executive risk defaulting in payment of about Sh53 million advanced to them as mortgage and car loans.

Mr Ouko has also expressed concern over slow repayment of the loans at a rate of between Sh39 million to Sh145.4 million monthly and improper valuation of land and motor vehicles used as security.

The report questions how the County will recover outstanding imprest of about Sh12.2 million it issued to its officers before they submitted the previous imprest or have the money recovered from their salaries.

In Uasin Gishu County, imprest of Sh 11.5 million had not been recovered from the salaries of the defaulting officers while others were issued with additional imprest of Sh9.6 million, raising doubt about management and control of the funds.

Some of the MCAs lost during the party primaries while others were voted out in the August General Elections.