City Hall has finally transferred contracts worth Sh1.3billion to the Nairobi Metropolitan Service for payment.
This marks the beginning of the county’s efforts to utilize the Sh3 billion set aside in the current financial year for payment of money owed to suppliers and contractors.
It also marks an end to the push and pull between the county government and the NMS that had made it impossible for any of the two to utilize funds from the current financial year’s budget.
The Sh1.3 billion will cater for all contracts and supplies made in the 2018/19 financial year with the rest subject to approval by a joint committee made of county and NMS officers. The NMS will only deal with contracts that are under the transferred functions.
Acting Nairobi City County Governor Ann Kananu admitted that the process has severally failed to work because of unending court battles and other politically instigated reasons.
“Some of these factors include delayed transfers from the national Government, own source revenue shortages, disputed payments and delayed legislations such as the recent Senate stalemate on revenue sharing formula, while some of the pending bills are inherited from previous local authorities and administrations,” Kananu said.
A report by the Auditor General indicates that the county has pending bills totaling to Sh10.67 billion.
It is expected that Sh1.7 billion will be released for payment of bills for the 2019/2022 financial year.
Those set to benefit are mainly garbage contractors, road contractors and small scale traders.
Contractors will take home Sh600 million while small scale traders who are owed less than 5 Million will cumulatively get Sh700 million.
Once done, the payments will reduce the debt to Sh5 billion and this could further drop down to Sh3.3 billion by the end of the current financial year.