Nairobi Losing Millions Of Market Revenues Due To Regular System Failures, Committee Told

• Nairobi county administration has been on the spot over revenue collection systems and missed targets
• The Nairobi County Assembly formed a committee to probe alleged diversion of county revenue
• During public participation forums, the committee established that regular system failures and reversals of payments were contributing to possible loss of county revenue

Michael Ollinga is a journalist at TUKO.co.ke with over 10 years of experience covering courts and crimes, special reports, and current affairs in Kenya.

Nairobi county government officials from the Trade and Market departments have opened the lid over the possible loss of millions in county revenues.

Committee probing Nairobi revenue queries

One of the officials told the Ad Hoc Committee probing revenue queries at City Hall that the county could be losing millions of shillings due to an unstable Nairobi Revenue System (NRS).

TUKO.co.ke understands that Nairobi has 42 recognised markets where revenue in terms of licenses and permits is collected.

Joyce Kyengo, Director of Markets in Nairobi, told the committee that the NRS's regular failures could have opened up an avenue for revenue collection officers to submit unverified figures of their choice to represent daily collections.

Nairobi County Assembly Majority Leader Peter Imwatok is leading the committee in probing queries about possible revenue diversion and the involvement of third parties in Nairobi's affairs.

Nairobi revenue collection system under probe

"The NRS failures have contributed to the possible diversion of funds and the inability to collect as per the set targets. Sometimes, we have to call our officers on the ground to forward the figures that they have collected,” Kyengo said.

The committee heard that the NRS fails almost three times a week and that the trade department's senior officials sometimes have to call revenue officers to share the amounts they have collected in cash.

While the county reiterates that it has digitised all its revenue collection systems, the official's revelation says something different about the actual state of affairs.

Traders open up on loopholes in Nairobi's revenue collection

According to the revelations made to the ad hoc committee, market revenues were regularly collected in cash, and revenue officers' discretion on the ground decided how much to send to the county's designated pay bill account.

The officials said this happened when the tablets assigned to the revenue collection officers failed.

According to Imwatok, Kyengo's admissions indicated that the county was not entirely responsible for the revenue collection process.

At Muthurwa, for example, Nelson Muthaiga, Chairman of the Muthurwa Traders Association, said that revenue officers collect money and decide how much to pay Governor Johnson Sakaja’s administration via a pay bill number whenever the NRS system is down.

The revelations emerged a day after the county's urban planning and parking fee revenue team revealed on Wednesday, December 13, that the county was also losing millions through cash reversals by property holders.

Parking fees reversals in Nairobi

Some committee members alluded to possible collusion between property holders, motorists, and revenue officers in cash reversals.

Lucy Kanini, the officer in charge of loading zones, admitted to the committee that the habit had been going on for a while.

She said that out of the nearly 180,000 properties in the new system, 177,000 contribute to the revenue pool, leaving a notable gap.

"We indeed experience some downfalls in the systems now and then, and parking is the greatest casualty of this," Kanini said.

System failures limiting Nairobi's revenue collection

It also emerged before the committee that defective invoices have been issued, exhibiting double the amount paid, while some payments have never been reflected in the system.

"If a person pays, let's say, KSh 10,000, we have seen the system generate an invoice for double the paid amount, " Stephen Mutua, the Head of Rates, said, revealing that others do not even appear in the system.

The committee members called for an immediate overhaul of the system to avert further losses of millions of shillings in county income.

This comes about a month after Kileleshwa MCA Robert Alai sensationally claimed that some faceless individuals could be interfering with Nairobi's revenue collection processes.