The Council of Governors (CoG) has criticised move by the National Treasury to reduce county equitable allocation for Financial Year 2017/18 saying it is unconstitutional.
Speaking at the CoG offices in Nairobi yesterday, chairman Josphat Nanok expressed concern with the proposal to reduce county governments’ allocation by about Sh18 billion. He said the National Treasury has not consulted with the governors and appealed to the Cabinet Secretary (CS) Henry Rotich not to make arbitrary decisions without consultations.
Nanok said the proposal by the CS has serious implications on service delivery as it requires amendment of Article 219 of the Constitution.
“The Council notes that Article 219 of the Constitution provides that a country’s share of revenue raised by the National government shall be transferred to the county without undue delay and without deduction hence the proposal by the CS is illegal,” he stated.
The chair also revealed that counties are in financial crisis three months to the end of this financial year as only 33 per cent of the expected 75 per cent has been disbursed.
“As it stands, the county governments are stuck with huge pending bills running to the tune of about Sh99 billion. Furthermore, the Sh302 billion equitable share of revenue that was allocated to counties in the 2017/18 financial year was a mediated figure,” he said.
He said that about 20 counties are badly off having received below 25 per cent of their allocations, about 24 other counties received 45 per cent and only three counties surpassed 50 per cent of their total equitable share.
Nanok urged the Senate to reject the proposed Bill as it seeks to reduce the amount of funds that should be allocated to counties.“The council further recognises the key role the Senate plays in promoting devolution and protecting the interests of county governments.
We, therefore, appeal to the Senate to ensure that this proposal by National Treasury is negated,” the council urged. The governors were reacting to Treasury CS Rotich’s remarks Wednesday that plans were underway to amend the Division of Revenue Bill to reduce allocation to counties by Sh15 billion to Sh17 billion. The proposed Bill requires county executives in charge of finance to justify imposition of the taxes, fees, levies and other charges.