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Proposals on business good for the economy

By Editorial Team
Monday, October 26th, 2020
President Uhuru Kenyatta and former Prime Minister Raila Odinga display copies of the report after its presentation by the Building Bridges Initiative at Kisii State Lodge. Photo/PSCU
In summary

While most Kenyans see the Building Bridges Initiative (BBI) as a political project, behind the facade are rafts of measures with direct knock-on effects on the economy and the business environment.

If implemented, some of the recommendations will not only lower the cost and ease doing business, but spur the growth of small and micro-enterprises in ways that can spur the economy to greatness.

BBI is pushing for more money in circulation to give the economy the impetus it requires, to spur growth by proposing to deal with the scourge of pending bills by amending the Procurement Act, 2015.

This will obligate accounting officers to operate in strict adherence to the approved procurement protocols.

It will be mandatory that settlement of invoices for goods and services supplied be made within 60 days after an invoice is dispatched.

The national and county governments racked up pending bills in excess of Sh200 billion in the last financial year, in a move which nearly crippled the economy.

The report requires that government procurement entities not only adhere to, but will also be required to carry out due diligence on bidders to lockout briefcase companies.

Companies with no track record of service delivery will not be awarded contracts, sealing the fate of people who create fake companies, to syphon taxpayers money.

It  has proposed that the Controller of Budget undertakes due diligence on the performance of ongoing projects, to ensure the remaining funds are only paid when the project meets the expected standards.

A radical consideration in the report is the move to create a good environment for SMEs by minimising taxation of new and small businesses, and giving them a tax holiday of at least seven years, as a cushion for youth entrepreneurship and job creation.

Following concerns over the negative impact of private betting industry on the youth, the BBI has moved that the sector be replaced with a state-run national lottery.

A government-run national lottery will put betting proceeds to better use for the benefit of society.

The report has also proposed the regulation of the popular but dangerous loan apps, which are driving up indebtedness of poor Kenyans with their excessive interest rates and borrowing from multiple platforms.

As the President said during the handing over of the report on Wednesday, read it and make informed business choices.

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