Underhand wars between members of the National Assembly and Senators have infiltrated the mediation committee, which is trying to resolve the impasse over an additional Sh20 billion for counties.
The 18-member committee, consisting of an equal number of Senators and Members of the National Assembly, held its second meeting on Tuesday, but failed to resolve the deadlock.
Senators want counties to be given Sh400 billion as shareable revenue. At the same time, Members of the National Assembly have proposed Sh380 billion for the devolved units leading to a clash between the two Houses.
And the war has now attracted governors, who have accused MPs of “creating an unnecessary crisis in the country.”
Council of Governors Chairman Ahmed Abdullahi said the impasse continues to hurt counties, with the devolved units’ operations now being in limbo as expected funds from the national government have been delayed.
“I want Kenyans to know that counties are in limbo, they are unable to make decisions, they cannot finalize their budgeting processes on account of the failure to have in place a County Allocation of Revenue Act,” Mr Abdullahi explained.
He went on: “Our reading of the law as told by our legal experts is that it is illegal and unconstitutional to finalize appropriation for either level of government without agreement on the Division of Revenue Act.
“…and it's not fair that the National Assembly approves appropriations for the National Government and that National Government conducts its business uninterrupted while counties are in limbo and unable to access money and carry out their daily operations. This was not the intention of our constitution.”
As MPs and senators continue to flex their muscles in order to get a deal, counties will continue to face a cash crunch as they have yet to get funds from the National Treasury for four months now.
The Nation has learnt that there are underlying issues that may prolong the committee co-chaired by Kiharu MP Ndindi Nyoro and Mandera Senator Ali Roba.
The committee, according to insiders, is now toying with the idea of inviting the National Treasury and the Council of Governors in a bid to try and get a deal.
According to members of the committee who talked to Nation , MPs have maintained that they must have control of the Sh10.5 billion of the Roads Maintenance Levy Fund that was frozen by the court following a case filed by the Council of Governors.
According to sources MPs want Senators to talk to the Council of Governors to withdraw the case on the fund, which is controlled by the Kenya Roads Board.
But Mr Abdullahi, the CoG chairman argued the equitable share and the Division of Revenue had nothing to do with the justice they are seeking in court with respect to the RMLF (Road Maintenance Levy Fund).
“The Constitution is in black and white with respect to roads, that there are only two categories of roads, only National Trunk Roads and County Roads, and we cannot have a country where we blatantly disobey the Constitution.
“There cannot be an RMLF that allocates money relating to County Roads to Kura and Kera and disregarding that the counties are devolved governments, they are governments, they have mandates over roads which they must maintain.”
But MPs feel that if the money goes to the control of governors, they will embezzle it as compared to if it’s in their hands.
“Without that money resorting back to our control, I can tell you, there will be no negotiations,” said an MP sitting in the mediation committee.
During the Tuesday meeting, Senator Roba confirmed that the impasse is being driven by the politics of the levy fund. He however said it would be unrealistic to send senators to negotiate with governors over the fund.
“It’s unrealistic to expect Senators to hold discussions with governors over the Roads Maintenance Levy Fund. Governors and Senators are not as close as some may think. Mr Roba said.
“The current crisis is being driven by the politics of the Roads Maintenance Levy Fund, in which the Council of Governors went to court. I would like to inform our colleagues in the National Assembly that Senators are committed to resolving this issue, but we are not in a position to engage with the Governors on this matter, as they are suggesting because we are not their darlings,” he added.
The courts in August not only froze the funds until the case filed by governors if heard and determined, but also suspended a decision by MPs not to recognize the county chiefs as beneficiaries of the fund.
Senators, according to sources in the committee, feel that their counterparts in the National Assembly are pushing for the levy fund for their benefit.
The flexing of muscles between the two houses is also likely to delay a deal on monies that should be shared with counties.
Senators want to be seen as working by supporting devolution hence do not want to be seen as approving a reduction of funds going to counties.
Mr Nyoro pointed out that even Members of the National Assembly are not against counties getting funds but urged their colleagues in the Senate to be alive to the current economic situation of the country.
"I would like to inform our colleagues in the Senate that we are not against counties receiving more funds, but we must consider the current situation in the country,” Mr Nyoro said.
The committee also finds itself in a dilemma on how to accommodate the Sh400 billion senators wants to be given to counties arguing that the National Assembly had already passed the Appropriation Act, 2024 which was assented to President William Ruto in August.
This means that to accommodate the Sh400 billion as demanded by Senators, the Act must be amended.
The Supplementary Appropriation Act was passed by the National Assembly in July following the rejection of the Finance Bill, 2024 after sustained protests by the young people.
The new Act introduced reductions to recurrent and development expenditure for the three arms of government, constitutional commissions, and independent offices.
The rejection of the Finance Bill, 2024 led to a revenue shortfall of approximately Sh344.3 billion a move which necessitated the Supplementary Appropriation Act in order to realign planned expenditures to the revised fiscal framework.
Following the rejection of the Bill, the National government suffered a reduction of Sh145.7 billion consisting of Sh40 billion for recurrent expenditure and Sh105 billion for development expenditure.
The Executive’s budget was reduced by a total of Sh139.81 billion drawn from various ministries. Parliament suffered a reduction of its budget by Sh3.7 billion while the Judiciary suffered a cut of Sh.2.1 billion.
Kitui Central MP Makali Mulu who sits on the mediation committee expressed hope that they will get a solution before they break for their long Christmas holidays.
“We are still negotiating and hopefully we will get a solution,” Dr Mulu told the Nation.
According to Article 112 of the constitution, the mediation committee is expected to come up with an agreeable version of the contest within 30 days which starts counting on the day the committee holds its first sitting.
However, if the committee fails to reach an agreement within 30 days, the Bill is deemed to have been defeated and may be re-published later in the same or amended form and re-introduced for consideration.
Council of Governors Chairman Ahmed Abdullahi says that without an immediate solution, many counties risk suspending key programmes.
“We are now in November; the last release which counties have accessed relates to August. We're still waiting for the September release to hit our County Revenue Fund accounts,” Mr Abdullahi said.
Many counties, he noted, are unable to pay salaries for the last three months.
County government workers across the country have been grappling with a financial nightmare that has resulted in months of delayed salaries following a cash crunch that had hit the devolved units.
Frustration is now mounting as workers long promised a fair share, feel neglected -- especially after national government employees received a long-awaited pay hike while county workers were left to fend for themselves.
“You are all aware that the Division of Revenue Act was passed, but the CARA (County Allocation of Revenue Act) was not assented to, and there was an attempt to amend the Division of Revenue to reduce the amount going to counties by Sh20 billion.
“We made our case to the Senate, and the Senate agreed with us and rejected the proposal to reduce the Sh20 billion, but the National Assembly, without getting a concurrence on the Division of Revenue Act, unilaterally went ahead and reduced that allocation by Sh 20 billion,” the CoG Chairman said.
He pointed out that the move necessitated the need for mediation between the Senate and the County Assembly.
