Governors yesterday urged the Senate to reject recommendations by the Treasury to reduce allocation to counties by Sh75 billion.
The Commission for Revenue Allocation proposed the 47 counties share Sh377 billion but Treasury cut the amount to Sh302 billion, including conditional grants.
Council of Governors chairman Peter Munya told the Senate Finance Committee to stick to CRA’s proposal of Sh377 billion for the financial year 2016-17.
Last month, Munya said the county bosses may be forced to call for a referendum if the national government does not release funds for devolved functions.
The Meru governor said it is unfair for the Treasury to slash the sharable revenue. “We, as the Council of Governors, plead that the Senate accepts the CRA recommendations which we agree with,” Munya told the Billow Kerrow-led committee.
Treasury PS Kamau Thugge defended the decision by government to slash the allocations, saying the national government is shouldering huge responsibilities that require financing.
He said the system of channeling money to counties through relevant ministries was supposed to ensure compliance with various requirements to guarantee financial prudence.
The governors asked the Senate to come up with a law to bar the national government from deducting, in advance, some national obligations before determining the counties’shareable revenue.
He cited the National Constituency Development Fund as among the expenses the government was wrongfully deducting from the total revenue raised nationally. Munya said this denies counties their rightful allocation. “CDF should be deducted from the share allocated to the national government because it is a national function. Deducting the money before arriving at the sharable revenue is unconstitutional,” Munya said.
He told the committee the national government is also wrong to deduct money for the national laptop project for pupils in primary school from the total revenue. “We are not saying our children should not get laptops, but it is a national government programme,” Munya said.
He called for review of the definition of national interests as stated in the constitution and further evaluation of conditional grants to counties address unnecessary ambiguities that delay development of donor funded projects, he said.
“We have a lot of challenges in implementing projects funded by donors because the national government continues to cling to the money through state agencies,” he said. Munya said all conditional grants and donor funds should be channeled to counties through the National Treasury, not through ministries.
Munya said the national government has no reasons against increasing the amount of funds shared to counties to 33 per cent from the current 15 per cent. Munya said by doing so, the county governments will have enough money to work for the people.
“It’s not fair to give us responsibilities, such as roads, water and agriculture but still retain the funds at the national level,” he said. Munya spoke at Chaaria Cottolengo Mission Hospital during a fundraiser. He said the current formula for sharing revenue is unfair.