At least 22 counties did not spend money on development between July and September 2020.
The Controller of Budget, Margaret Nyakan’go, in her quarterly report for the 2020/2021 financial year, singled out Bomet, Baringo, Embu, Garissa, Homa Bay, Isiolo, Kajiado, Kwale, Makueni, Meru, Migori, Mombasa as among the affected counties.
Others are Nairobi City, Nyamira, Samburu, Tana River, Turkana and Uasin Gishu.
Ms Nyakan’go attributed the slow absorption of development funds to delays in disbursement of money by the National Treasury to the counties due to the prolonged standoff in senate on the approval of the Third Revenue Allocation Formula.
The stalemate, which lasted four months into the 2020/2021 financial year, occasioned the delay in the approval of the County Allocation of Revenue Bill (CARB), 2020 until October 8 when it was assented.
“Consequently, counties could not receive the FY 2020/21 equitable share of revenue raised nationally during the first quarter of FY 2020/21 thereby negatively affecting budget implementation,” Ms Nyakan’go said in her report.
During the period, counties could only access Sh69.84 billion. This included a balance for the previous year’s equitable share of Sh26.2 billion released in August 2020 and Sh37.7 billion, which was also a balance from the previous year.
The counties also collected Sh5.85 billion that was raised from the own sourced Revenue (OSR), which was a decline from the Sh7.71 billion in three months to September last year.
Development expenditure is critical in the counties because it includes building infrastructure like roads and sewerage and putting money in private hands through demand for raw materials, which ultimately creates new jobs.
It is also used in improving health systems in counties, which has been very dire during the Covid-19 pandemic.
Further, the report highlighted Kitui, Mandera and Wajir however did not spend anything on development or personal emoluments and operation and maintenance costs.
This was blamed on the failure by the counties to approve the budget estimates or a vote on account which would allow the county government to withdraw money from the County revenue fund (CRF) despite there being no approved budget.
“The stalemate in the approval of budgets was mainly due to frosty relationships between the County Executive and the County Assembly. This was also attributed to capacity challenges in the understanding of the roles of the two arms of government in the budget making process,” the report read.
During the three months, the other 25 counties spent Sh2.3 billion out of the Sh159.3 billion that had been budgeted for by the counties.
Muran’ga county was ranked highest in absorption of the development funds after spending Sh426.7 million out of the Sh3.1 billion it had set aside.
Kisumu and Narok Counties were ranked second and third after spending Sh393.7 million and Sh164.3 million respectively.
The report also noted the dwindling revenue collection in the counties seeing as none of the counties collected even a quarter of its target in the three months.
"Counties should develop and implement strategies to enhance own- source revenue collection in order to ensure the budget is fully financed. Further, counties are urged to monitor the performance of own source revenue mobilisation with a view of making budget adjustments during the supplementary budget process,” the report read further.
