Governors are pushing for the establishment of a special fund for urban areas as they target Sh20 billion annually to help decentralise services.
The county chiefs said neglect and under-investment in urban areas had led to the proliferation of informal settlements. Currently, there are about 1,411 informal settlements in urban areas across the 47 counties, most of them in Nairobi, Mombasa and Kisumu.
The Council of Governors said a national urban development fund will focus on neglected areas to improve their status. Lands, Housing and Urban Development committee chairperson Anyang’ Nyong’o (Kisumu) said Parliament should provide funds to support urbanisation and urban development. He noted that there was a huge financing gap for urban infrastructure.
In the last five years, 89 municipalities in 45 counties, excluding Nairobi and Mombasa, have only received Sh72.9 million through the Kenya Urban Support Programme, which began in January 2018 and is set to end in July. The money comprised Sh62.7 million from the county governments and Sh10.19 million from development partners. A total of 24 municipalities have missed out on the funds.
“The council deliberated on this matter and approved a resolution to engage with the national government and Parliament to explore the creation of a National Urban Development Fund,” said Prof Nyong’o, adding that urban areas are getting a raw deal in funds allocation despite being the revenue baskets.
He pointed out that the county governments have in the past funded the urban areas mainly from their own revenue and grants and donations. However, he said, legislation is needed to enable cities and urban areas to collect and spend part of their own-source revenue at source as envisaged in section 172 (a) of the Public Finance Management (PFM) Act.
This is in addition to legislation to implement Section 173 of the PFM Act touching on the criteria for the allocation of funds to cities and urban areas.
Prof Nyong’o spoke when he appeared before the Senate Devolution committee chaired by Wajir Senator Mohamed Abass to respond to a question by Kajiado Senator Seki Lenku regarding the implementation of the second level of devolution through decentralisation of services in urban areas. The senator wanted to know why municipalities have not achieved financial autonomy as anticipated in the PFM Act.
“We want to realise more devolved functions in our cities for people to get services. We want to see mechanisms in place where counties can transfer funds to municipalities and give the municipality managers autonomy to do their work,” said Mr Seki.
Prof Nyong’o called for an amendment to the Urban Areas and Cities Act, 2011, to change the composition of the municipal board and strengthen them. The council also wants the chairs of the boards picked by the governor, with members appointed by Urban Development executives. The board members, Prof Nyong’o said, should not be subjected to approval by the MCAs to avoid having politicians push for the appointment of unqualified people.
Nairobi Governor Johnson Sakaja, who also appeared before the committee, spelt out his plans to create five boroughs in Nairobi and give ownership to the residents through their respective associations. He asked the Senate to amend the Urban Cities Areas and Cities Act, 2011 to introduce a section specifically addressing boroughs as administration units. He also asked that governors be granted the authority to formulate regulations concerning the administrative units.
“We want the Senate to help us strengthen the boroughs by amending the law to introduce such units. It should be anchored in law so that we don’t get problems while dealing with the Controller of Budget,” he said.
