Treasury yet to disburse Sh155bn to counties as financial year-end nears

The National Treasury has only disbursed only Sh214.6 billion in equitable share to county governments since June last year with over Sh155 billion still outstanding two months to the end of the financial year.

The disbursement translates to 58 percent of the Sh370 billion due to the 47 counties in the financial year ending June 30, 2023.

According to data from the Treasury submitted to the Senate County Public Investment and Special Funds committee yesterday on the status of disbursement, the Exchequer blamed the delays in the disbursement on shortfall in revenue collection as well as high public debt obligations.

Treasury Cabinet Secretary Njuguna Ndung’u said the devolved units have received Sh244.2 billion, including Sh29.6 billion June 2022 arrears that had not been disbursed in the previous financial year.

He said that they disbursed Sh31.45 billion to counties last week being January equitable share allocation.

However, up until April, county governments are owed Sh94.35 billion for the three months with February’s allocation being Sh31.45 billion, March 29.6 billion and April Sh33.3 billion.

“The delay in disbursement of funds to counties has been occasioned by shortfall in revenue collection as well as high public debt obligations. However, the National Treasury is mobilising necessary resources to ensure that the amount owed to counties is significantly reduced,” said CS Ndung’u in the letter.

The CS added that the Treasury is also assisting county governments to enhance their own-source revenue to ensure continuity of services in case of delays in disbursement of equitable share.

Nonetheless, the Vihiga Senator Godfrey Osotsi-led committee heard none of the explanation by the CS, saying revenue collection shortfall should not be used as an excuse yet the Kenya Revenue Authority (KRA) said they have surpassed its targets.

“Why is the CS saying KRA has not been meeting its targets yet the taxman presented data saying they have surpassed their revenue target? We need to invite both the CS and KRA to know who is telling the truth,” said Narok Senator Ledama Olekina.

“We need to know where the money is going to whether it is being diverted to paying to paying public debt or being misused,” he added.

Kiambu Senator Karungo Thang’wa said that it is regrettable that counties have only received 58 percent of their equitable share threatening their operations as most are staring at grinding to a halt or have accrued debts due to bank overdrafts.

“If there is anything that we must fight for as the Senate is disbursement of funds. We must ensure timely disbursements by coming up with ways to ensure prompt release of funds,” he said.

Migori Senator Eddy Oketch said they have to stand firm as the Treasury last month also said they did not have money until they stood firm resulting in the release of the January disbursement.