The National Treasury has directed accounting officers of state corporations, funds and semi-autonomous agencies to prioritize payment of pending bills before the closure of the current financial year ending June 30, 2023.
Data from treasury indicates that out of the Ksh 537.2 billion worth of pending bills accrued by the National Government as at March 31, 2023, State Corporations and Semi-Autonomous Government Agencies (SAGAs) account for Ksh 450.2 billion of unpaid bills to suppliers and contractors.
In a circular to all chief executive officers of state corporations and SAGAs), funds, vice chancellors of public universities and principals for Technical Vocational Education Trainings (TVETS) and Teachers Training Colleges (TTCs), National Treasury and Economic Planning Cabinet Secretary Prof. Njuguna Ndung’u directed the accounting officers to ensure ongoing commitments which do not involve awarding of contracts are honored.
“Accounting Officers are, therefore, required to service the continuing contractual obligations as per the contract agreement to avoid accumulation of expenditure arrears (pending bills),” said Prof. Ndung’u.
In the Supplementary Appropriation Act, the government has set aside Ksh 60 billion to clear pending bills.
The payment of the bills is expected to stimulate economic activity especially among small businesses whose financial positions have been negatively impacted by the delayed payments.
Treasury plans to establish a Pending Bills Verification Committee from the next financial year in what Prof. Ndung’u said in his maiden budget speech will help carry analysis of the stock of all pending bills and advise on how the bills will be settled.
“Once the outstanding pending bills are cleared by the verification Committee, the National Treasury will direct all Entities to ensure strict adherence to Public Finance Management Act, 2012 and clear pending bills as a first charge on the budget of the concerned Entity in the subsequent financial year,” he earlier stated.
The chief executives are also urged to ensure bank reconciliations are completed and submitted by 10th next month as well as surrender all imprests by close of the current financial year.
“All sanding and temporary imprest should be surrendered on or before 30th of June 2023. In line with Regulations 92(7) of the Public Finance Management Act, 2015, an Accounting Officer must ensure full recovery of un-surrendered imprest,” said Prof. Ndung’u.
The accounting officers are further required to submit details of the current bank accounts and their status, annual financial statements, form team to prepare the financial statements, implement audit recommendations from previous years, status of donor funded projects and disclose their climate finance expenditures and disaster related expenditures.
