Lobby Group Moves to Block 2025/26 Budget Over Sh600 billion Pending Bills » Capital News
NAIROBI, Kenya April 16 – A lobby group has filed a petition in court seeking to suspend the ongoing budget-making process for the 2025/26 financial year until the government settles all pending bills amounting to over Sh600 billion, arguing that failure to do so constitutes a breach of public trust and threatens economic stability.
Human rights organisation Operation Linda Jamii, through its representative Frederick Ogola, wants the High Court to compel the government to pay all outstanding bills accrued between June 1, 2005 and June 30, 2022 before it can proceed with the next budget.
Thousands of suppliers and contractors have incurred millions of shillings in bank interest from loans borrowed to finance government projects —some of which have remained unpaid for over 20 years.
There are reports that some suppliers have been pushed to the brink, with a number forced to sell their properties to stay afloat, while others have slipped into depression due to the prolonged financial strain.
Appearing before Justice Grace Nzioka on Wednesday, Ogola argued that the unpaid bills—Sh516 billion by the national government and Sh182 billion by counties—pose a serious threat to the economy, especially for Micro, Small and Medium Enterprises (MSMEs), many of which are owed money by the state.
“The country is staring at a serious economic problem. The formation of a committee to audit these bills, without transparency or clear timelines for payment, is a delay tactic. The court must intervene,” Ogola told the court.
The petition also challenges the legality of the committee appointed by President William Ruto in September 2023 through Gazette Notice No. 13355 to verify the pending bills. The lobby claims the committee’s formation lacked transparency and replicates previous failed attempts to address the issue.
Justice Nzioka directed that the petition be served to the National Treasury, Attorney General, Auditor General, and the National Assembly. She ordered the respondents to file their responses ahead of a mention date set for April 25, when the court will issue further directions.
In court documents, the petitioner argues that the Budget Policy Statement dated February 13, 2025 is misleading and lacks good faith. It criticises the Treasury for promising to boost MSMEs through a Sh60 billion allocation under the Hustler Fund, while failing to address the unpaid bills that continue to cripple small businesses.
“There is a serious contradiction by the 2nd Respondent in the Budget Policy Statement dated 13th February 2025,” the petition reads. “While the Treasury claims MSMEs are a top priority, it has not shown any commitment to paying what it owes them.”
Operation Linda Jamii accuses the government of using its plan to shift from cash-based to accrual-based accounting as a strategy to downplay the scale of pending bills and delay payments. The group argues that this undermines the rights of suppliers, contractors, and service providers who have waited for years to be paid.
The petitioner further claims that successive committees tasked with auditing or verifying pending bills—both at national and county levels—have failed to yield meaningful results, often citing lack of funds or political interference.
“The appointment of the recent audit committee is just another smokescreen,” Ogola submitted. “We want the court to supervise the verification and payment process directly to ensure accountability.”
The lobby says it is not just a matter of numbers, but a human rights concern. “SMEs are collapsing, livelihoods are being destroyed, and the state is failing in its duty of care to citizens who entered contracts with it in good faith,” the petition argues.
The court’s ruling could set a precedent for how the government handles its financial obligations, and the outcome of the case will be closely watched as Treasury officials prepare to table the 2025/26 national budget in Parliament in the coming weeks.