- The commission has recommended that the allocation to the 47 counties retain at Sh370 billion in the next financial year.
- In the current financial year, all the counties were allocated Sh370 billion after a protracted fight over the revenue-sharing formula in the senate last year
Image: FILE
Governors could get their way in the push for additional allocation to counties after senators backed their call to increase the revenue share for 2022-23.
The county chiefs, through the Council of Governors (CoG), have been embroiled in a bitter fight with the Commission on Revenue Allocation (CRA) over the matter.
The commission has recommended the retention of the allocation to the 47 counties at Sh370 billion in the next financial year. CRA also recommends the allocation of Sh1.76 trillion to the national government.
In the current financial year, all the counties were allocated Sh370 billion after a protracted fight over the revenue-sharing formula in the Senate last year.
Already, CRA chairperson Jane Kiringai has submitted a report containing the recommendation to the Senate for consideration.
Nairobi Senator Johnson Sakaja tabled the commission’s report on Tuesday.
However, the governors have rejected the commission’s proposal and have been pushing for additional allocation for Sh381.45 billion to push the total allocation to Sh751.5 billion.
Senators have sided with the county bosses for more funds, saying inflations, among other considerations, should be factored in the allocations.
“We will ask whether they have taken care of inflation because, obviously, there has been inflation over the year,” Senate Finance committee chairman Charles Kibiru said.
The Kirinyaga senator said they will ensure the allocations are fair and take care of all the devolved functions.
“The mandate of the Senate is to protect the interest of the counties and their governments and ensure that the shareable revenue takes care of all services offered in the counties,” he said.
Kibiru’s committee has been tasked to scrutinise the CRA report. It will invite devolution stakeholders, including members of the public, CRA and the CoG, to give their views on the proposal.
The committee shall then file a report back to the House recommending approval or rejection of CRA’s recommendation.
Nandi Senator Samson Cherargei termed it unfair for the counties to get a paltry Sh370 billion from a budget of more than Sh3 trillion.
The outspoken lawmaker reckoned that the counties should not share the responsibility of the national debt.
“Counties should be given even up to Sh500 billion from the budget of Sh3 trillion. We have CRA recommendation and we don’t know why the commission wants the counties to share with the national government responsibilities of the national debt,” he said.
In its recommendation, the commission says slow economic growth, constrained fiscal framework, the need to contain pubic debt and finance security operations for the 2022 general election informed its decision.
However, the CoG has vehemently rejected the recommendation.
“To safeguard devolution and ensure optimal implementation of the devolved functions by the county governments, the council proposes additional funding of Sh381.45 billion,” CoG chairman Martin Wambora said last month.
The governors said that CRA’s proposal does not reflect and is not commensurate to the growth in revenue for the financial year 2022.
“Following an in-depth discussion on the issue, we wish to reiterate that we reject in totality the proposal by CRA that recommends non-increment of the county equitable share,” Wambora said.
The county bosses also pegged their argument on the proposed constitutional amendment through the Building Bridges Initiative, which proposed allocation of 35 per cent of the ordinary revenue to the counties.
“We would like to reiterate proposals contained in the Constitution of Kenya (Amendment) Bill, 2020, which recommends that counties not be allocated less than 35 per cent of all the revenue collected by the national government,” CoG Finance committee chairman Ndiritu Muriithi said.
However, Kiringai says stretching the caps to accommodate the request by the CoG would mean more borrowing and budget cuts for state agencies.
The National Treasury projects revenue to grow to Sh2.14 trillion from the current Sh1.80 trillion.
“Given the country’s economic growth situation, there is a need for economic stimulation as a measure to spur economic recovery and growth. This will only be achieved through increased resources to the counties,” Muriithi said.
The Laikipia governor said allocation to the counties should not be affected by the factors listed by the commission, adding that revenue shortfall should be borne by the national government.
“We propose that the CRA review its proposals for the equitable share of the revenue for the financial year 2022-23 and increase the allocation to the county governments."
(Edited by Bilha Makokha)