The County Assembly of Meru has expressed concern over ballooning bills emanating from court decrees against the devolved unit.
According to the legal affairs department, the county requires about Sh1 billion to settle various bills resulting from court decrees and legal fees.
This comes even as the county treasury is struggling to enforce austerity measures to facilitate payment of pending bills running into another Sh1 billion accrued over the years.
The County Assembly budget and appropriations committee last week made terse recommendations to the executive to halt the growth of legal bills.
For instance, county officials are scratching their heads over a Sh650 million bill awarded to a French investor for wrongful eviction from the Meru National Park.
According to the county assembly report, governor Kawira Mwangaza’s administration is also struggling to clear Sh74 million owed to Prof Tom Ojienda’s law firm for services offered under the Governor Peter Munya regime.
Committee chairperson Jacob Mwirigi blamed the high legal bills, partly, on the county’s overreliance on contracted law firms.
Mr Mwirigi advised the governor to recruit a county attorney and empower the office. If this is not done, the assembly will not allocate funds for procuring legal services.
“The Committee observes that there is a need for the executive to empower their internal legal office to handle legal disputes against it with a view of reducing their expenditure in contracting legal services providers.” The County Fiscal Strategy Paper report states.
MCAs have also urged the executive to adopt alternative dispute resolution mechanisms to reduce the cost of procuring legal services.
The County assembly also slashed the executive’s local revenue projection by Sh150 million blaming the unrealistic targets for ballooning pending bills.
“Persistent own source revenue deficits have compromised service delivery since the County Government of Meru is unable to fully fund its obligations. We have therefore reduced the own-source revenue target from Sh600 million to Sh450 in the next financial year,” Mwirigi said.
In efforts to contain its pending bills, Meru County treasury has warned that departments which accumulate huge pending bills will be forced to scale down on both recurrent and development spending.
In the latest County Debt Management Strategy Paper, Finance executive Ibrahim Mutwiri stated that stern action was needed to end the accumulation of pending bills in the future.
As of December 2023, the county had accumulated recurrent and development pending bills worth Sh648.8 million Meru County is also yet to pay about Sh7.4 million incurred by the defunct local authorities more than 11 years after devolution.
“Recurrent pending bills arising from all departments will be cleared as a first charge in the succeeding year’s budget…departments that have accumulated huge recurrent bills will face liquidity challenges and implementation of some of the sector’s programmes may be compromised…” the finance department proposes.
In the 2022/2023 financial year, Governor Kawira Mwangaza’s administration paid pending bills amounting to Sh397 million.
The finance executive cites unrealistic revenue projections, late procurement and fluctuating revenue for high pending bills every financial year.
“One of the first steps in addressing a persistent arrears problem is to strengthen the realism of the annual budget…Going forward, the local revenue projections will be based on actual collections from the previous year…” the debt ,management strategy states.
The county also intends to adopt debt restructuring and rescheduling as well as establishment of a county debt management committee to improve cash flow management.
