Nairobi's cash flow woes continue

Cash flow issues for its suppliers and contractors were caused by the fact that Nairobi county had more than 40 billion bills in the last financial year when it was under the stewardship of the Nairobi Metropolitan Services.

The Controller of Budget CoB's latest data shows that Nairobi's bills rose to Sh 99.06 billion for the year ended June 2022, from Sh 54.32 billion a year earlier, adding to the cash flows of firms and contractors that have done business with the county.

As of June, Nairobi s share of bills is 70 percent of the 153.02 billion that firms and contractors owe, pushing them into cash-flow woes.

The devolved units to pay for goods and services were highlighted by the continued disregard by the devolved units to pay for goods and services delivered at the end of the 2020 21 financial year and the Sh 57 billion surge in 12 months.

The county of Nairobi didn't prepare a satisfactory payment plan for the pending bills in the current financial year. CoB Margaret Nyakango said in the report that the county treasury did not provide a report on the settlement of pending bills during the period under review.

The county of Kiambu posted the second biggest jump in unpaid bills in the period under review after the arrears went up by 2.37 billion to 5.87 billion.

The coastal county of Mombasa had a 760 million jump in unpaid bills to close the year, with Sh 5.87 billion owed to firms and contractors.

The rise in unpaid bills highlights the disregard of counties to past directives from the presidency and National Treasury to clear the arrears in a bid to address cash-flow malaise in the private sector.