State publisher–Kenya
Literature Bureau is struggling to pay suppliers due to cashflow issues from delayed
payments amounting to Sh1.05 billion mostly by government institutions.
Auditor-General
Nancy Gathungu’s report on KLB’s accounts show the bureau is owed Sh1.05
billion in trade and other receivables, with Sh251.5 million having remained
unpaid for more than 90 days.
The state-owned
publisher told Parliament that efforts to recover the money from government
agencies have largely failed, exposing a growing cash flow crisis within the
public sector where institutions are unable to collect payments from fellow
government entities.
Appearing before
the National Assembly’s Public Investments Committee on Governance and
Education, KLB has warned delayed payments have weakened its finances, making it
difficult to pay suppliers and sustain normal operations.
The warning came
as MPs demanded tougher action against defaulting public institutions instead
of allowing debts to accumulate for years before being written off.
Public Investments
Committee Chairperson Dick Maungu said recovering even part of the outstanding
amounts would significantly ease the bureau’s financial pressures.
“If you
recover even a fraction of these debts, you will be able to pay salaries for
some of your staff. You can try to be aggressive in recovery measures rather
than seek debt write-offs,” said Maungu who is also the Luanda MP.
KLB managing director
George Okeyo said the bureau’s biggest challenge is collecting payments from
fellow government institutions, noting that administrative efforts over several
years have yielded little success.
“If we are
allowed by the government to take drastic action against fellow government
institutions, we would do so. We have used all the avenues available to KLB
over the years, but we have failed to recover these debts,” Okeyo told the
committee.
The committee
questioned why some debts dating back to 2015 remain unresolved, with MPs
dismissing suggestions that statutory time limits should automatically prevent
recovery.
Central Imenti MP
Moses Kirima said KLB had not exhausted available legal options, arguing that
courts have discretion to extend limitation periods where circumstances justify
recovery.
“It shows a
lack of seriousness. If you have a legal adviser, they should know that courts
can extend time to enable recovery where necessary,” he said.
The hearing
exposed the wider challenge facing many state corporations, where delayed
payments by government agencies create a chain reaction of cash flow problems,
leaving suppliers unpaid and forcing institutions to seek Treasury support
despite being owed substantial sums.
KLB assistant finance manager, Kenneth Adongo, identified delayed payments by government
agencies as one of the bureau’s biggest operational risks.
He disclosed that
the Kenya Institute of Curriculum Development (KICD) alone owes KLB more than
Sh1.3 billion, making it difficult for the publisher to settle its own
suppliers and maintain smooth operations.
The bureau also
blamed frequent curriculum changes for worsening its financial position, saying
booksellers are often left holding obsolete textbooks worth millions of
shillings, complicating debt recovery.
Concerned by the
growing culture of non-payment across the public sector, the committee directed
its secretariat to summon the Council of Governors to explain outstanding debts
owed by county governments to state agencies, including KLB.
MPs also resolved
to question the National Treasury CS over delays in settling payments between government institutions.
The committee
further rejected KLB’s proposal to write-off a Sh921,000 debt owed by Jomo
Kenyatta University of Agriculture and Technology, insisting that every
available recovery avenue must first be exhausted.
KLB said it has
since strengthened its credit management systems by establishing a dedicated
credit control function to improve debt follow-up and reduce future defaults.
