Kilifi’s Sh10.7 Billion debt crisis puts county leadership on the spot

Kilifi’s suppliers and contractors have told senators that a mounting mountain of unpaid county bills is pushing local businesses towards collapse, as the Senate County Public Accounts and Investments Committee demands answers from the County Executive over a Sh10.7 billion debt burden.

The disclosures, made during a public engagement between the committee and suppliers at the Kilifi County Assembly in Malindi on Monday, have placed the county leadership under renewed scrutiny over how public money is managed and why legitimate claims have remained unsettled for years.

The Sh10.7 billion in pending bills makes Kilifi the second-most indebted county in the country after Nairobi, according to data presented to the committee. The scale of the liability has prompted committee chairman Moses Kajwang to describe the county as technically insolvent.

But behind the billions is a more immediate crisis: businesses that say they have supplied goods and services to the county are struggling to survive while waiting for payment.

“We are suffering and if you don’t step in and help us, no one will,” said Joshua Chai, chairman of the suppliers’ association.

One supplier told the committee the county owes him Sh17 million, while another said he is owed Sh16 million.

For some suppliers, the issue is no longer simply an accounting dispute. They said delayed payments have left businesses facing financial distress, with some staring at bankruptcy and the auction of their assets.

Others said the county sometimes pays only a portion of what is owed, leaving suppliers waiting for months — and in some cases as long as a year for the balance.

The suppliers also questioned why debts dating back as far as a decade remain unsettled while newer obligations are allegedly given priority.

Their complaints raise a fundamental question for the county administration: How did a county receiving billions of shillings in public revenue allow unpaid obligations to reach a level capable of threatening the businesses that support its economy?

Kilifi received Sh14.3 billion in total revenue in the 2024/25 financial year, comprising Sh12.8 billion in equitable share and Sh1.5 billion in own-source revenue.

Against that revenue, the county’s pending bills have reached Sh10.7 billion, putting its revenue-to-debt ratio at about 70 per cent, according to figures presented to the committee.

Senator Kajwang said the figures warranted urgent intervention, arguing that the consequences were extending beyond government accounts to the wider Kilifi economy.

“You are removing these suppliers from business and with that you are killing the economy,” he said.

He challenged the Kilifi County Assembly to use its oversight powers to demand detailed explanations from the County Executive.

“Do a detailed inquiry and demand for answers and bring this cycle of poverty to an end,” he said.

The suppliers said previous attempts to establish the true size and legitimacy of the debt had failed to produce a clear public record.

Chai told the committee that at least two task forces had been established to verify and validate the pending bills, but their findings were never made public.

That has left suppliers asking whether the county has a complete and credible register of what it owes, who it owes and why those debts remain unpaid.

The concerns became sharper when the committee examined the county’s financial management systems.

According to data from the Office of the Controller of Budget, 612 transactions worth Sh3.2 billion were voided in the Integrated Financial Management Information System, or IFMIS.

The figure has raised questions about the processing of county payments and whether weaknesses in the system have contributed to the accumulation of pending bills. The Controller of Budget has previously called for systemic and legislative gaps in IFMIS management to be addressed.

Suppliers also made serious allegations about the payment process.

They claimed that vouchers belonging to some suppliers were used to initiate requisitions for withdrawals, but payments were eventually made to other suppliers.

Some alleged that politically connected suppliers or businesses willing to offer bribes received preferential treatment.

Those allegations have not been established and require investigation. But their appearance before the Senate committee puts the County Executive under pressure to provide documentary evidence showing how payments are prioritised, how suppliers are selected and how pending bills are verified and settled.

The Senate committee has now made clear that the financial crisis cannot be brushed aside.

Governor Gideon Mung’aro had been scheduled to appear before the committee but did not attend after reporting that he was indisposed. The committee subsequently directed Deputy Governor Florence Chibule to appear and explain the county’s financial position. The committee has said county government business must continue even when the governor is unavailable.

The demand for answers comes at a critical moment for Kilifi residents.

Every unpaid legitimate county bill represents more than an entry on a government ledger. For a small contractor, it can mean unpaid workers, mounting bank loans and a business unable to take on its next job. For suppliers, prolonged delays can mean losing access to credit and ultimately shutting down.

For residents, the consequences can extend to stalled projects, delayed services and a weaker local economy.

That is why the Senate’s intervention has shifted the debate from simply asking how much Kilifi owes to asking why it owes so much, who approved the commitments, whether the debts are genuine, why verified suppliers remain unpaid and what the County Executive intends to do to prevent the debt from growing further.

Kajwang has proposed that the Senate explore a framework under which verified and properly documented bills could, where legally possible, be paid at source. He has also called for the involvement of National Treasury Cabinet Secretary John Mbadi in addressing the crisis.

The committee’s scrutiny now places the County Executive before a straightforward test of public accountability: produce the records, explain the debt and show Kilifi residents how the county intends to settle legitimate obligations without compromising essential services.

The suppliers who appeared before the committee are not merely creditors on a government spreadsheet. They are businesses operating within the county whose survival is tied to whether the public administration pays its bills.

For Kilifi, the Sh10.7 billion question is therefore bigger than the debt itself.

It is a question of whether public resources are being managed in a manner that protects businesses, preserves public services and safeguards the economic interests of the residents who ultimately fund and depend on the county government.

The County Executive is expected to provide its response as the Senate inquiry continues.