Delayed pay hurts efforts to build youth enterprises
3 months ago, 14 Maý 14:15
Unemployment, especially among the youth, is one of the toughest challenges that Kenya faces in its attempt to cut the levels of poverty. A number of strategies has been rolled out in a bid to address this seemingly intractable problem.
Some of the plans include creating the Youth Enterprise Development Fund (YEDF) and setting aside 30 per cent of government tenders for the youth, women and the disabled.
While experts say these initiatives can go a long way in addressing the challenge of unemployment among young people, a look at the performance of these plans leave a lot to be desired.
Take for instance the 30 per cent tender rule. One of the fundamental challenges encountered by the youth who embraced the idea is delayed and disputed payments. These impediments have ended up compounding the plight of startups.
Some youth businesses are currently in dire financial straits while some have been compelled to close down altogether because of unpaid bills running into millions of shillings. “I tried working with few parastatals but the indefinite turnaround time of payments affected my liquidity, compelling me to close shop,” said an entrepreneur who sought anonymity for fear of jeopardising his future deals with government institutions.
The 28-year-old IT entrepreneur had to wait for up to four months before getting paid for his consultancy services.
He said in some instances, he was asked to supply the services even before the contract was drawn. When a formal contract failedo materialise, he had to use the letter of the tender award to make claims for payments. This posed plenty of difficulties in his pursuit for his dues, he said.
The entrepreneur said his story is similar to that of other youth who have dealt with tenders from the national government and county governments.
The problem of unpaid bills apparently runs deep in businesses across the country. Recently a group of contractors instituted civil proceedings against the Nairobi County Government demanding payments for their services. The proceedings were however dropped after the county asked for more time to scrutinise the validty of some of the claims.
In January, Controller of Budget Agnes Odhiambo revealed that Nairobi County accounted for 62 per cent of the Sh96.4 billion worth of debts that the 47 devolved units had accumulated in the 2016/2017 financial year.
She told Parliament that the pending bills had grown in the current financial year to reach Sh99.2 billion, adding that there was need for an audit on the swelling pending bills by county governments.
A share of these pending bills belongs to the youth who had sought to take advantage of the government initiatives to better their standard of living.
Gideon Keter, the youth representative in the National Assembly, notes that while the government has come up with initiatives to encourage the youth to venture into business, a lot remains to be done in terms of implementation.
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