Covid-19: Government Suspends All Payments Owed Until Further Notice

The Kenyan government has halted payment of any money owed to individuals and organizations until further notice, this is as a measure to preserve funds to deal with the Coronavirus (COVID-19).

According to an internal memo from the Controller of Budget (CoB) Margaret Nyakango to her staff, the government will only process salaries for civil servants.

“This is to inform you that the National Treasury and Planning has put on hold all commitments, payments, and claims as the country assesses the resource requirements for COVID-19 interventions,” the memo dated the 31st of  March reads. “…As you are aware, COVID-19 has come with requirements not initially anticipated in the budgets. For that reason, after establishing the costs, our budgets will be reorganized through a supplementary budget in line with the PFM Act. My internal memo was done in the spirit of informing staff of the goings-on, a promise that I made to them earlier.

Contractors and suppliers will now have to wait even longer to get paid. The Treasury had, however, at the beginning of March announced it had reduced pending bills by nearly 90 pc, offering relief to suppliers and contractors that have been the target of auctioneers.

The government has exhausted all its revenue wells, as of March 13th, domestic debt stood at Sh3.043 trillion, the total public debt has hit Sh6.3 trillion. The treasury has nowhere to run to.

The memo was issued as the country comes face to face with a recession due to the Coronavirus,  infected cases in the country hit 81 Wednesday.