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Why Nairobi County staff risk missing salaries

Nairobi County government staff may not receive their salaries after Central Bank of Kenya (CBK) had monies transferred from the county government’s account to the taxman’s to cater for arrears of up to Sh1 billion.

In a suit filed on Monday, the Nairobi County government faulted the Central bank for directing funds totalling Sh1,017,393,208 from its recurrent account and having it credited to Kenya Revenue Authority’s Domestic Taxes income tax payer account.

According to Nairobi County, the transaction is illegal and is calculated at sabotaging as well as blackmailing the Evans Kidero-led government to outrageous uneconomically sustainable demands.

“The funds herein were illegally transferred to KRA’s account yet they were solely meant to cater for the due salaries of the employees who are in the Nairobi county government’s payroll,” said Prof Tom Ojienda, acting for the county.

COURT ORDER

The County government claimed that a temporary court order had been issued on December 19, last year stopping KRA from issuing any notices of getting monies from Equity Bank, Cooperative Bank, CBK and Webtribe limited for tax arrears.

The county government also claimed that the five institutions who are listed as interested parties in the suit, are aware of the existing court order, however KRA went ahead to issue an agency notice on April 13 to CBK while demanding payment of the said monies as tax due to it.

The county government alleged that it did notify KRA that its action was in contempt of court through a letter dated April 20 but did not receive any response.

And on April 26, the Principal Finance officer of the county government requested the office of the Controller of Budget (CoB) for grant on credit on exchequer account of Sh1,093,000,000, from its revenue account to the recurrent one, being part of expenditure for the period ending June.

The CoB authorised the requisition but in May, the county government received a letter from CBK notifying them about the transfer of the monies.

VIOLATION OF LAW

They alleged that the act is disobedience of a court order and a violation of the Public Finance Management Act.

“There is a lot of unrest and tension in the Nairobi City Hall as the employees have not received their monthly salaries to date, it is therefore imperative that KRA be compelled to release the monies that were transferred to it by CBK so that the county government can meet its recurrent expenditures,” said Prof Ojienda.

They want the matter considered as urgent, an order issued to KRA to return the said monies and that Equity Bank, Cooperative, CBK and Webtribe limited be barred from acting contrary to the orders issued last year.