A new report highlights the crippling debt owed by government entities, with billions in pending bills causing financial distress for suppliers, some of whom have reportedly taken their lives due to unpaid dues. Doing business with the government, once lucrative, now poses significant risks.
According to Controller of Budget Margaret Nyakang’o, national government pending bills stand at Sh528 billion, with counties owing an additional Sh168 billion. The debts include unpaid contracts, staff loan deductions, and penalties, such as Sh15 billion in accrued interest by state corporations.
State corporations account for the largest share, with ministries, departments, and agencies adding Sh117.7 billion. Key sectors like energy, infrastructure, and education face the heaviest burdens. Entities such as Ketraco (Sh22 billion), Kenya Power (Sh20 billion), and various universities owe billions.
Treasury CS John Mbadi acknowledged the strain but emphasized that the current administration cannot resolve decades-old debts instantly. Auditor General Nancy Gathungu has repeatedly called out agencies for breaching financial regulations, urging them to prioritize clearing pending bills before starting new projects.
To address the issue, Treasury has recommended halting new projects until existing bills are paid, while ramping up revenue collection to prevent further accumulation of debt.
