County cash crisis: So close, yet still a long way to go

The earliest the county governments can access the Sh316.6 billion allocated to them this financial year is Friday, but only if President Uhuru Kenyatta signs the County Allocation of Revenue Bill, 2020, once cleared by Parliament. 

The signing into law of the Bill, currently before the National Assembly, will pave the way for the National Treasury to prepare and present to the Senate for adoption the cash disbursement schedule that indicates how much each of the 47 county governments is to receive every month.

The schedule must be passed by the Senate before Controller of Budget Dr Margaret Nyakang’o releases the money from the County Revenue Fund to the counties.

The revenue Bill was passed by the Senate the week before last and transmitted to the National Assembly for concurrence.

The Senate, however, amended the Bill so that the counties can receive in lump sum what was due to them in the first quarter of the 2020/21 financial year.

Public participation

Last week, the Bill went through the reading in the National Assembly and was committed to the Budget and Appropriations Committee for public participation in line with Article 118 of the Constitution. The committee is then expected to present a report to the House for debate and adoption, or rejection.

A schedule of business to be transacted in the National Assembly tomorrow afternoon posted on the Parliament website, shows that the Bill will be passed during the sitting after concluding debate on the committee’s report.

Once passed in the National Assembly, it will be referred back to the Senate before it is taken to the President for assent.

The failure to enact the law in good time was caused by the Senate delays to pass the third generation formula as advised by the Commission on Revenue Allocation.

The formula, to be in force in the next five years, according to Article 217 (1) of the Constitution, is a prerequisite of the County Allocation of Revenue Bill. It defines the parameters to be used when splitting the devolved funds among the 47 county governments.

Sunday, Makueni Senator Mutula Kilonzo Junior and his Vihiga colleague George Khaniri said the counties need the funds urgently.

“I urge the President to immediately sign the Bill once it is presented to him so that we can have the cash disbursement schedule brought to the Senate by Wednesday this week. By Thursday we should be done with the schedule,” said Mr Kilonzo.

Mr Khaniri noted that the Senate will always be alive to the interests of the counties.

Pay salaries

“It is a pity that the first quarter of the current financial year ended without counties getting their share. But we hope that the President will overlook the bureaucratic processes and sign the Bill once it lands on his desk,” said Mr Khaniri.

Already Council of Governors (CoG) chairman Wycliffe Oparanya, who is also the Kakamega governor, has warned that counties will shut down today for lack of funds to pay staff and provide services.

The shutdown will be the second after the September 17, 2020, botched attempt as the governors protested the delays in passing the formula.

“We are asking President Uhuru Kenyatta to make this his first priority when he returns home from France. Counties are now forced to approach banks for overdrafts to pay salaries. This is unacceptable and if we do not get the money by Monday then the only option is to shut down our operations,” said Mr Oparanya.

If the bureaucracies of legislation in Article 115 of the Constitution were to be followed, once the Bill is passed by Parliament, the Speaker of the House that originated it, in this case the Senate, shall within seven days present it to the President for assent.

The President shall have 14 days from the date the Bill was presented to him to sign it or refer it back to Parliament for reconsideration while noting any reservations. If the 14 days expire without the Bill being signed or returned to parliament for reconsideration it shall be deemed to have been assented and shall therefore become law.

But even as the counties continue to wait for the cash, Governor Oparanya claimed that there is a sinister motive to scuttle the gains achieved by devolution.

Mr Oparanya blamed the Senate for causing the stalemate on the third generation formula which has led to the delay in the release of funds to counties.