NMS Begins Clearance of City Hall Debts

  • Nairobi Metropolitan Services (NMS) boss Mohammed Badi speaking on the Jeff Koinange Live show on October 28, 2020.
    Nairobi Metropolitan Services (NMS) boss Mohammed Badi speaking on the Jeff Koinange Live show on October 28, 2020.
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  • Nairobi Deputy Governor Anne Kananu Mwenda led the Nairobi City County Government (NCCG) in handing over pending bills files worth Ksh1.3B to NMS Director-General Mohammed Badi.

    The decision is expected to pave way for the clearance of debts owed to various suppliers. Many of them have been camping at City Hall for three years. 

    Kananu stated that the decision was arrived at after the office of the Auditor-General asked the Treasury to undertake a special audit in line with section 96(3) of the Public Finance Management.

    The NMS and Nairobi County Government formed a committee to look into contracts and files of accumulated debt by City Hall. 

    Pending bills accumulation has raised concerns before and has put suppliers on the edge. This is because the county procures goods and services from different entities and the payment is honoured as per terms of the contract.

    The county government has often found itself facing a cash deficit and therefore unable to make due payments. 

    Some of the difficulties the county faced financially include delayed transfer of funds from the national government, Senate stalemate on revenue-sharing formula, disputed payments and pending bills inherited from the previous administrations.

    Late settlement of debts attracts penalties and interest for suppliers which leads to county governments losing credibility to contractors and suppliers. 

    Pending bills also exacerbate liquidity constraints on suppliers which has a ripple effect that has contributed to massive job losses.

    Kananu urged the NMS to make pending bills approval the first item of expenditure on their budget and vowed to task her team to adopt a phased approach to settling the dues in installments in order to restore liquidity for business owners.

    ''Today we are happy to handover the pending bills files worth Ksh 1.3B over to NMS for payment. I will task my finance team to adopt a phased approach to settling outstanding arrears, even if it means settling bills in installments in certain circumstances in order to restore liquidity to business owners. Top of my agenda is fostering a new spirit of co-operation, collaboration, partnership and mutual respect among all organs of Government, the County Assembly, Nairobi City Staff, key shareholders and other partners,'' Ann Kananu.

    The supremacy battles between NMS Director-General Mohammed Badi and ex-governor Mike Sonko were so vicious to a point where service delivery in the county was threatened.

    In September 2020, Treasury CS Ukur Yatani declined a request from Badi to release payment money for 6,800 county staff citing lack of legal framework as the reason and that the funds could be remitted to the county revenue fund account and not to NMS.

    The deal reached today is expected to go a long way in enhancing the collaboration between the city-county government and the NMS which is a creation of the national government. 

    Former Nairobi Governor Mike Sonko during his impeachment hearing in December 2020.
    Former Nairobi Governor Mike Sonko during his impeachment hearing in December 2020.