The Nairobi County Government plans to use private debt collectors on business and property owners who have been defaulting debt payment in the city.
The Nairobi county Government already owes its creditors about 66.6 billion shillings and targets companies and individuals who evade paying up charges for services they enjoy such as house rent, market fee, billboards advertising, unified business permits, and parking fees.
These private debt collecting agents will be paid on commission by the county government of Nairobi once they are ready to start the programme.
“The overall objective of this assignment is to help reduce the number of the county’s debts and liabilities and then put in place sustainable long-term debt and liabilities management strategies,” said the county administration.
The county administration further explains that the inability to recover debts from defaulters, bringing them to book and addressing the issue, has pushed the county to come up with a debt defaulting clause, where private businesses and companies pay their dues in advance at a discounted rate.
According to reports by the County Government, top on the list of debt defaulters is Deputy President William Ruto’s office.
The deputy president’s office owes the county government 189.08 million shillings that are supposed to have been for the 115 reserved parking spaces on Harambee Avenue.
The DP’s office has reportedly failed to pay its 14.06 million shillings debt, which was a fee for 10 parking spaces on Parliament lane, since 2014.
Among the creditors owed by the county government are Lapfund and Laptrust. The two pension funds are owed a sum of 13.8 billion shillings from the county.
By end of the financial year in June, the county had only managed to collect 8.8 billion shillings in ten months to June compared to the 9.8 billion shillings collected in the year 2017
The county’s debt rate reportedly rose from 55.5 billion shillings in July 2017 to 66.6 billion shillings by June 2018, making it an 18.1 percent increase.