NMS FUNDS CRISIS

Sonko beats Badi in tussle over city power

The NMS cannot access funds to pay salaries for 6,502 seconded staff.

In Summary
  • National Treasury Cabinet Secretary Ukuru Yatani declined a request from NMS to release funds.
  • This means that Badi can only access money if the county government releases funds to them from the County Revenue Fund.
President Uhuru Kenyatta and Nairobi Metropolitan Service Director General Mohammed Badi on October 6, 2020 in Industrial Area
President Uhuru Kenyatta and Nairobi Metropolitan Service Director General Mohammed Badi on October 6, 2020 in Industrial Area
Image: MAUREEN KINYANJUI

Despite having President Kenyatta’s full support, Nairobi Metropolitan Services is still facing difficulties.

On Friday last week, Uhuru urged Nairobi residents to support NMS director general Mohammed Badi in managing the county.

“I'm humbly requesting you to support Badi because he is doing good work, and let us work together. If Nairobi improves it will be for everybody,” Uhuru said while addressing the public in Pumwani.

 

However, it is not a walk in the park for Major General Badi.

The NMS cannot access funds to pay salaries for 6,502 seconded staff.

Last week, National Treasury Cabinet Secretary Ukuru Yatani declined a request from NMS to release funds noting there was no legal framework to facilitate such a transaction.

On September 3, Badi requested the National Treasury to release the money to pay salaries after health workers under NMS held protests over the delayed pay.

Yatani pointed out that Section 4(2) of County Allocation of Revenue Act, 2020 provides that each county governments’ allocation shall be transferred to the respective County Revenue Fund, in accordance with a payment schedule approved by the Senate and published in the Kenya gazette by the CS in accordance with section 17 of PFM Act, 2012.

 

"The above legal provisions, therefore, imply that equitable share allocation due to Nairobi City County Government, including monies for personnel emoluments, shall be transferred to NCCG Revenue Fund Account," he said in a letter dated October 15.

This means that Badi can only access money if the county government releases funds to them from the County Revenue Fund.

Uhuru and Nairobi Metropolitan Service director general Mohammed Badi on October 9, 2020 along Kangundo Road
Uhuru and Nairobi Metropolitan Service director general Mohammed Badi on October 9, 2020 along Kangundo Road
Image: MAUREEN KINYANJUI

Other than staff salaries, projects under the four transferred county functions risk stalling until matters surrounding the county budget are resolved.

On October 15, Nairobi Governor Mike Sonko declined to assent the Nairobi City County Appropriations Bill, 2020, referring it back to the county assembly with a memorandum.

The bill was passed by the county assembly on October 8, approving a Sh37.5 billion budget that allocated NMS Sh27.1 billion and left Sh8.4 billion to Sonko’s administration.

In the memorandum, Sonko rejected the transfer of Sh 1.3 billion Ward Development Fund from his office to NMS, Sh1.6 billion to NMS for inspectorate services and the entire allocation to the environment, urban renewal and housing and health.

 “NMS is not a delivery unit within Nairobi county government and therefore does not qualify to find its way in the appropriation as a vote for the appropriation of funds,” Sonko said.

The governor wants the assembly to reduce the budget from Sh 37.5 billion to Sh31.6 billion in accordance with the County Fiscal Strategy Paper 2020-21 and budget estimates presented to it by Finance executive Allan Igambi in February and April.

Sonko argued that the budget has contravened provisions of the Public Finance Management Act, which provides that the total budgeted revenue and expenditure must be balanced.

County assembly Speaker Benson Mutura said the governor’s memorandum will be considered when the house resumes plenary sittings on November 3.

The speaker has to commit the memorandum on the floor of the house and thereafter the committee on Finance takes up the matter.

Once the memorandum is committed, the committee will have 21 days from November 3 to look into it.

Treasury CS Yatani declared he couldn’t release any funds until the dispute between NMS and county government is resolved.

On July 24, Governor Sonko registered a notice of declaration of a dispute.

A month later, officials from both the county and national governments started meeting at the office of the Attorney General where Solicitor General Kennedy Ogeto was in charge of the arbitration committee which aims at coming up with a solution.

Article 112 of the Deed of Transfer states that parties shall endeavour to resolve disputes amicably through negotiation.

"Given the above legal provisions and the ongoing negotiations, the National Treasury awaits further guidance from the office of the Attorney General on the way forward on the above issues,” Yatani said

Edited by Henry Makori