Kisumu County has blamed delays by the National Treasury for the voiding of transactions amounting to Sh2 billion during the last financial year.
According to county officials, the Treasury's late disbursement of funds created severe cash flow challenges, leaving the county unable to process payments for ongoing projects, suppliers, and service providers before the financial year closed.
As a result, multiple transactions had to be canceled, dealing a major blow to development plans and service delivery.
“The delayed release of funds led to a situation where payments could not be processed in time, forcing us to void transactions worth billions of shillings,” a senior county finance officer said.
He added that the disruptions affected key sectors such as infrastructure, health, and agriculture, and caused frustrations among contractors who had already completed their work but are yet to be paid.
The County Assembly has expressed concern over the scale of the voided transactions and has called for a detailed audit to establish the full extent of the financial disruptions.
“We need a comprehensive audit to determine not only the financial impact but also to identify systemic issues that must be addressed to avoid a repeat of this situation,” said a member of the County Assembly’s Budget and Appropriations Committee.
Contractors and suppliers have also decried the delays, saying they have been forced to halt operations or scale down projects due to unpaid invoices.
County leaders are now urging the National Treasury to streamline its disbursement process and adhere to timelines outlined in the Public Finance Management Act to safeguard service delivery at the county level.
The voided transactions come at a time when counties across Kenya have been raising concerns about cash flow problems, citing frequent delays by the National Treasury in releasing funds meant for devolved units.