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GOVERNORS PROTEST DELAY

Treasury closes year with Sh68bn for counties

Some regional governments are yet to receive upto 30 per cent of their allocations

In Summary

• In April, Nyakang'o said in a report to the Senate that the Treasury had withheld part of some counties' disbursements for failing to clear pending bills.

• Nairobi, which was allocated Sh16.80 billion for the year, has received Sh11.70 billion or 70 per cent of the total allocation.

Governors Kiraitu Murungi, Kivutha Kibwana, Wycliff Oparanya and Mwangi Wa Iria during a press conference at the Council of Governors offices in Nairobi
Governors Kiraitu Murungi, Kivutha Kibwana, Wycliff Oparanya and Mwangi Wa Iria during a press conference at the Council of Governors offices in Nairobi
Image: FILE

The National Treasury closed the financial on Tuesday without disbursing Sh68 billion to the counties.

This dealt a blow to the county governments that largely rely on the exchequer to implement development projects, pay salaries and support other operations.

Long before the Covid-19 pandemic, the counties’ own revenue sources were mired in under-performance with some devolved units hardly hitting 50 per cent of their targets.

Governors have criticised the Treasury for holding onto the funds, reckoning that carrying forward the cash will lead to accumulation of pending bills and stifle development.

According to a status report for county governments 2019-20 cash releases as of June 30, the Treasury was yet to release Sh68.15 billion out of the Sh375.59 billion allocated to the counties.

The Star obtained the report from the Controller of Budget Margaret Nyakango on Tuesday.

The cash comprises Sh316.5 billion equitable share and Sh57.09 billion in grants from the National Government and development partners.

The source of the grants, which are channelled through the Treasury, include the World Bank’s Kenya Urban Support Programme, Danida’s health programmes and the European Union that supports implementation of major water projects.

The report shows that some counties are yet to receive up to 30 per cent of their annual allocation, casting doubt on the government’s commitment to devolution.

Only Baringo received more than 90 per cent of its allocation in the 2019-20 financial year.

The North Rift county received 95 per cent or Sh5.42 billion out of the Sh5.73 billion it was allocated for the year under review.

Nairobi, which was allocated Sh16.80 billion for the year, received Sh11.70 billion or 70 per cent of the total allocation.

Busia and Kiambu received 75 per cent of their allocations (Sh5.17 billion out of Sh6.85 million and Sh9.58 billion out of Sh12.84 billion) respectively.

Other counties that received less than 80 per cent of their annual allocations are Uasin Gishu (78), Taita Taveta (79), Mombasa (76), Nakuru (79), Lamu (79), Machakos (79) and Kisumu (79).

Bungoma county received 82 per cent, Bomet 87, Murang'a 85, Wajir 84, West Pokot 84, Turkana 85, Vihiga 80, Kakamega 85, Kericho 82, Nyeri 84, Makueni 84, Mandera 86 and Kajiado 84.

Council of Governors chairman Wycliffe Oparanya protested the National Treasury's action, saying it has plunged the devolved units into huge debts.

Oparanya said the delay to release the funds is a blow to the counties already reeling from the adverse economic effects of the Covid-19 pandemic.

“Mainly, we blame the National Treasury for equitable share because that is what they are supposed to disburse from the exchequer,” Oparanya said.

Oparanya said as a result of the ‘erratic’ disbursement of the cash, governors have been forced to hold onto the money they get from Treasury for payment of salaries – hoping to receive full disbursement at the end of the year to pay contractors.

“Some [governors] have been keeping [the money] just to pay salaries because if you take the whole money to development, the following month the disbursement delays, then you will find that you are in a fix - you won’t have money to pay salaries,” Oparanya said.

“Development might be going on but this is going to leave huge pending bills. If you find that a whole billion has not been disbursed to you, obviously if you get this money, you will pay some of the debts. But because it isn’t not coming, you keep what you have for salaries," he added.

In April, Nyakang'o said in a report to the Senate that the Treasury had withheld part of some counties' disbursements for failing to clear pending bills.

 

Edited by P.O