Senate fights move to slash counties cash

Dinah Ondari @dinahondari

After the controversial passage of the Finance Bill, 2018 by the National Assembly last week, the National Treasury faces a fresh hurdle, with senators vowing to reject a proposal to slash counties allocation by Sh9 billion.

The looming stand-off could have far-reaching ramifications on the operations at the counties, which are already crippled by a cash crunch and saddled with huge unpaid bills— and if the proposal to amend Division of Revenue Bill sails through.

Nairobi County, the biggest loser, will receive Sh455 million less from its Sh15.8 billion budget while the other 46 counties will lose on average Sh192 million each from Sh314 billion in the 2018/19 financial year.

And in what is likely to worsen the already frosty relations between Senate and National Assembly—senators have vowed to reject proposals to slash Sh9 billion from counties only a day after the Council of Governors rejected the same.

As other sectors and Kenyans suffered the tax cuts and burden,  the MP insulated their Sh33.3 billion National Government Constituencies Development Fund (CDF) and Sh2.1 billion Affirmative Action Fund. 

Yesterday, Senate Devolution committee chair and Laikipia Senator John Kinyua said the move to cut counties  allocation was ill-advised warning that it will undermine operations in the devolved units.

“Ever since devolution became a reality in Kenya, the money to counties has never been enough, such a move would be disastrous. It is not a good idea,” he told People Daily.

Makueni Senator Mutula Kilonzo Jr, who is also the Minority Whip was more direct: “ We will not (support). I will whip members to reject…just like the previous budget, counties are the first to suffer financial distress”.

He decried what he termed as “step-child treatment” of the counties the National government and National Assembly.

The Senators’ opposition to the National Treasury’s proposal comes hot on the heels of a statement signed by Council of Governors (CoG) chair and Turkana Governor Joseph Nanok, expressing strong reservations on any proposal to cut funding to counties.

However, Senate County Public Accounts and Investment Committee chairperson Moses Kajwang’ (Homa Bay) adopted a more conciliatory tone, saying the House may be forced to adopt the proposals because sharable revenue, which is the basis upon which allocation of funds to counties is based, has reduced.

“Technically, we find ourselves is a very difficult situation, but if you argue in the context of section 5 (1) of Divisions of Revenue Act (DORA) which provides that if the actual revenues raised nationally falls short of the expected revenue, the shortfall shall be borne by national government, then the Senate can reject the proposal in the same spirt,” he said, adding that as the Minority, they are yet to hold a parliamentary group meeting to discuss the way forward on the matter.

According to the CoG, counties had already ceded ground during their February Intergovernmental Budget and Economic Council (IBEC) meeting chaired by Deputy President William Ruto to only accept Sh12 billion increment from the last budget.

The meeting chaired by Nanok said the budget was based on a Sh1.6 trillion revenue projection. However, when the national budget was finalised in June, the National Treasury reviewed the projections upwards by Sh82 billion to Sh1.79 trillion but allocation to the 47 counties remained the same.

Nanok argued that counties bear the heaviest burden in service provision, thus budget cuts will affect livelihoods in all critical sectors such as health, roads, water and agriculture.

“Since the main components of the Big Four agenda are devolved functions, the National government will need to work closely with counties to achieve this development blueprint,” he said.

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