NAIROBI, Kenya – Pending bills by the national government surged by Sh104.3 billion between April and June 2025, undermining months of progress in clearing arrears owed to contractors and suppliers.
Fresh data from the National Treasury shows that outstanding pending bills rose to Sh525.9 billion at the end of June, up from Sh421.6 billion in March.
The increase comes despite a government drive launched in late 2024 to verify and settle dues, particularly in the road sector.
“The outstanding pending national government bills as of June 30, 2025, amounted to Sh525.9 billion. They comprise Sh404.3 billion (76.9 per cent) for State Corporations (SCs) and Sh121.6 billion (23.1 per cent) for ministries, State departments, and other government entities,” the Treasury reported.
Most of the arrears relate to payments for contractors, suppliers, pension obligations, and unremitted statutory deductions.
Progress Reversed
In the first half of 2025, arrears had declined by Sh118 billion from Sh539.9 billion in December 2024 after the Treasury authorised ministries and agencies to pay verified claims.
By May, the pending bills verification committee had reviewed Sh663 billion in claims, clearing Sh578 billion and certifying Sh229 billion for payment—including Sh80 billion for road projects.
To support settlements, the Kenya Roads Board (KRB) tapped a short-term bridge loan ahead of issuing two bonds backed by the Roads Maintenance Levy Fund (RMLF).
In June, it released Sh60.6 billion to road agencies, including Sh29 billion to the Kenya National Highways Authority (KeNHA), Sh27 billion to the Kenya Rural Roads Authority (KeRRA), and Sh4.7 billion to the Kenya Urban Roads Authority (KURA).
The Cabinet also authorised KRB to dedicate Sh12 of every Sh25 collected from the RMLF to compensate investors in the Sh300 billion bonds earmarked to clear current and future road sector arrears.
Treasury Defends Progress
National Treasury Principal Secretary Chris Kiptoo defended the government’s record, insisting that across the 2024/25 fiscal year, verified arrears were settled.
“As we cross over the 2025/26 fiscal year, we have paid all counties their dues. We also did the same for CDF, all ministries, and State departments. This addresses the issue of pending bills,” Kiptoo told MPs last week.
“This time we don’t have pending bills carried over because we managed to settle all the requests.”
Gaps in Discipline
Despite these interventions, the Treasury flagged gaps in financial discipline within ministries and State corporations, warning that lapses continue to generate new arrears.
By law, ministries and agencies are required to clear all carryover expenditures from the 2024/25 financial year as a first charge on their budgets.
The fresh build-up of arrears now threatens efforts to inject liquidity into the economy by unlocking billions of shillings owed to businesses in the private sector.
