Accusations and counter-accusations have ensued as the cash crunch in the counties worsens, with governors warning of a shutdown should the situation not improve within two weeks.
In a blistering attack, the Council of Governors expressed dissatisfaction with senators’ failure to build consensus on the third generation revenue-sharing formula and threatened to file a petition for the dissolution of the Senate for undermining devolution.
“We forewarn the Senate that a petition for its dissolution can be initiated by any member of the public through the High Court as provided for under Article 258 of the Constitution,” CoG Chairman Wycliffe Oparanya said in a statement. The Senate suspended debate on the County Allocation of Revenue Bill, 2020, pending debate and adoption of the third basis of sharing formula.
But the adoption of the formula has hit a snag with senators failing to agree on the formula at least 11 times on the floor.
A 12-member committee established to develop consensus has also run into headwinds amid claims that it’s being held hostage by 2022 politics.
Without the bill being enacted, the transfer of funds to the counties has been affected, causing serious challenges in the funding of both development and recurrent expenditures in the counties.
Governors say county governments are unable to pay salaries and allowances of health workers who are battling Covid-19.
“If the prevailing situation persists, counties will have no choice but to shut down... services will not be available and we shall release all employees to proceed on leave,” Mr Oparanya said.
Devolution Cabinet Secretary Eugene Wamalwa also weighed in on the issue, asking the Senate to expedite debate even as he admitted that service delivery in counties is at standstill.
“We want to ask our senators to do their constitutional duty to ensure that a fair and equitable formula is arrived at so that funds are released to the counties. These counties are struggling and they need money,” he said in Eldoret on Thursday.
He disclosed that the national government is ready to disburse funds to the counties once the stalemate surrounding the revenue-sharing formula is unlocked.
However, the Senate pushed back the accusations and instead pointed an accusing finger at Controller of Budget Margaret Nyakango, claiming that her failure to enforce the public finance management regulations is the cause of the county cash woes.
At a press briefing at parliament Buildings, Majority Whip Irungu Kang’ata said the CoB should have invoked the regulations to ensure that the disbursement of cash to the counties is not interrupted and that service delivery is sustained.
Section 134 of the regulations states: “If the County Allocation of Revenue Bill submitted to Parliament for a financial year has not been approved by Parliament or is not likely to be approved by Parliament by the beginning of the financial year, the Controller of Budget may authorise withdrawals of up to 50 percent from the Consolidated Fund based on the last County Allocation of Revenue Act (CARA) approved by Parliament for the purposes of meeting expenditure of the county governments for the financial year.
“Non-passage of CARA or even the delay in adopting a new formula is not sufficient ground to trigger the alleged cash crunch in the counties. There is a legal mechanism,” Mr Kangata said.
But Dr Nyakang’o accused the senators of misleading the public, noting that her office can only authorise withdrawal of funds already released by the National Treasury.
“Senators are aware of this and they should not mislead the public,” Ms Nyakang’o told the Nation in response to Mr Kangata’s press statement.
In any case, she added, she only authorises funds where the National Treasury has disbursed the funds to the counties and the county assemblies have enacted the Appropriations Acts.
“My office authorises withdrawals from County Revenue Fund. This assumes that Treasury has released funds from the Consolidated Fund. I suggest that you ask the National Treasury to release the funds whose withdrawal I will then approve.”
By Kennedy Kimanthi, Onyango K’Onyango and Ibrahim Oruko
