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Taxpayers slapped with Sh20m interest on Mombasa bypass pay delay
Taxpayers have taken a Sh19.9 million hit in form of interest charges following delayed payments to a firm constructing a key bypass linking the Mombasa port with the main highway to Nairobi.
Auditor-General Nancy Gathungu has flagged the expenditure in her latest report on the Mombasa Port Area Road Development (MPARD) project.
“The payment of interest on defrayment of delayed payments leads to loss of government funds which could have been avoided,” she said in the report for the year ended June 2021.
The bypass whose construction started in 2012 is meant to ease traffic congestion following the opening of the new Kipevu container terminal at the port.
Its construction is also meant to facilitate trade in the Coast region and neighbouring countries by reducing transit time and cost incurred in cross-border movement.
The Japanese government awarded Kenya Sh29 billion for use in the MPARD mega-project.
Delays by the exchequer to fund the project have seen it accumulate pending bills that stood at Sh4.7 billion by June last year.
Pending bills consist of unpaid liabilities at the end of the financial year arising from contracted goods or services during the year in the past years.
Mounting supplier debt at the national and county levels has compounded cash flow challenges for firms, especially micro-and small-sized ones, forcing some of them out of business.
The Treasury estimates that arrears owed to contractors and suppliers by State corporations as well as ministries, departments and agencies hit Sh423.1 billion in September 2021 from Sh359.5 billion six months earlier.
This is despite a presidential directive that ministries and parastatals treat verified arrears as the first charge in their expenditure plans.
Ms Gathungu also noted an expenditure of Sh686.1 million relating to road construction that was not supported with entries in the ledger, payment vouchers or interim payment certificates.
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www.businessdailyafrica.com
Taxpayers slapped with Sh20m interest on Mombasa bypass pay delay
Taxpayers have taken a Sh19.9 million hit in form of interest charges following delayed payments to a firm constructing a key bypass linking the Mombasa port with the main highway to Nairobi.
Auditor-General Nancy Gathungu has flagged the expenditure in her latest report on the Mombasa Port Area Road Development (MPARD) project.
“The payment of interest on defrayment of delayed payments leads to loss of government funds which could have been avoided,” she said in the report for the year ended June 2021.
The bypass whose construction started in 2012 is meant to ease traffic congestion following the opening of the new Kipevu container terminal at the port.
Its construction is also meant to facilitate trade in the Coast region and neighbouring countries by reducing transit time and cost incurred in cross-border movement.
The Japanese government awarded Kenya Sh29 billion for use in the MPARD mega-project.
Delays by the exchequer to fund the project have seen it accumulate pending bills that stood at Sh4.7 billion by June last year.
Pending bills consist of unpaid liabilities at the end of the financial year arising from contracted goods or services during the year in the past years.
Mounting supplier debt at the national and county levels has compounded cash flow challenges for firms, especially micro-and small-sized ones, forcing some of them out of business.
The Treasury estimates that arrears owed to contractors and suppliers by State corporations as well as ministries, departments and agencies hit Sh423.1 billion in September 2021 from Sh359.5 billion six months earlier.
This is despite a presidential directive that ministries and parastatals treat verified arrears as the first charge in their expenditure plans.
Ms Gathungu also noted an expenditure of Sh686.1 million relating to road construction that was not supported with entries in the ledger, payment vouchers or interim payment certificates.
[email protected]
Taxpayers slapped with Sh20m interest on Mombasa bypass pay delay
Taxpayers have taken a Sh19.9 million hit in form of interest charges following delayed payments to a firm constructing a key bypass linking the Mombasa port with the main highway to Nairobi.
www.businessdailyafrica.com
