Did you know that some services at City Hall are now crippled? This follows a concern by Auditor general Edward Ouko raised over City Hall’s inability to recover more than Sh307.6 billion owed by various players.
Ouko, in his 2016-17 audit report, said amount owed to the county by property owners, national government agencies and other actors have been increasing over the years.
During the year under review, the debt rose by Sh98.6 billion from 209 billion in 2015-16 financial year. This represented Sh47 per cent increase.
“The significant increase in outstanding receivables and in particular outstanding rates is an indication that the county government has not put adequate measures in place to collect and clear the outstanding rates,” reads the report.
The county has blamed insufficient funds for poor roads, lack of drugs in hospitals, piling garbage and poor drainage.
Evans Kidero, during his reign as Nairobi Governor, complained about the billions of shillings owed to the county government by the national government bodies. The debt, he said, slowed development and hampered delivery of services.
Governor Mike Sonko has also realised that the huge amount owed is hitting the county hard, and Thursday, his officers began clamping high-end buildings in the CBD, Kileleshwa, Karen and Westlands in a bid to recover the money.
Kidero clamped several private and public properties during his time to recover the debt, but it appears the operation did not help. KBC premises on Harry Thuku Road, Laico Regency and Utalli House are some of the properties that were clamped.
According to records at City Hall, Harambee House, Harambee House Annexe, Vigilance House, National Treasury Building and Parliament Buildings owe the county millions of shillings in unpaid land rates.
But the auditor said in the report that failure by City Hall to develop systems and mechanism to recover the huge amounts it is owed. Automation of revenue collection has not helped. According to the report, 99 per cent of the total outstanding receivables is rates owed by developers.
It says that Shh305, 367, 800 out of the Sh307, 697, 532 billion owed to City Hall is outstanding rates. This is an increase of Sh97.7 billion or 47 per cent from the previous year.
“As noted in the previous year, the likelihood of collecting outstanding rates from defaulters appears to be too low,“ Ouko said.
According to the county 2018-19 fiscal strategy paper, City Hall, has never hit its revenue target in all the over 134 streams. This is despite automating collections in April 2014 to seal leakages that were linked with manual systems.
Do you think the state will clear the debts anytime soon?