The standoff between the Senate and the National Assembly looks set to end after a resolution was reached on the disbursement of county funds on Wednesday, November 20.
The Mediation Committee of both Houses struck a deal on the Division of Revenue Bill, 2024, that will see counties get Ksh387 billion for the upcoming financial year.
“We cannot afford to give our counties less money than they received in the previous financial year. We have agreed unequivocally and unanimously that our counties deserve resources. For that reason, we have reinstated the figure counties received in the previous financial year of Ksh385 billion. On top of that, we have made and provisioned additional resources to the tune of two billion to make our counties perform their duties efficiently,” noted Ndindi Nyoro, chair of the National Assembly’s Budget and Appropriations Committee.
The new development comes after the two sections of Parliament were at loggerheads over the amount of revenue to be allocated to counties. The rift emerged after the National Assembly had passed the Division of Revenue Bill 2024, which had allocated a share of Ksh380 billion to counties, aligning with the Treasury’s proposal.
However, Senators demanded that counties be allocated Ksh400 billion. They fiercely opposed the Ksh20 billion cut, arguing that essential programs tied to non-discretionary expenditures totalling Ksh39.9 billion and linked to national government projects would be severely affected.
Senate Finance Committee Chair Ali Roba cited government initiatives like the housing levy, county health worker employment, the leasing of medical equipment, and National Social Security Fund deductions as some of the key programs at risk if the National Assembly went ahead with the proposed allocation.
The budget cut was necessitated by the withdrawal of the Finance Bill 2024, which had caused nationwide protests. Appearing before the Senate Finance and Budget Committee, Treasury Cabinet Secretary John Mbadi explained that the initial Ksh400 billion allocation was based on an anticipated revenue of Ksh2.9 trillion, which has since been revised down to Ksh2.6 trillion due to a shrinking revenue base.
“The proposed Ksh380 billion for this financial year is just one per cent lower than the Ksh385.4 billion allocated last year. We believe this is in line with the Constitution, which calls for stable and predictable revenue allocations to counties,” Mbadi told the committee.
The impasse between the Senators and MPs resulted in governors on Monday, November 18 threatening to shut down counties within 30 days.
The county chiefs threatened to halt operations in all 47 counties after a council meeting on Monday to discuss several bills, including the Division of Revenue Amendment Bill 2024.
The protracted deliberations saw the former Prime Minister, Raila Odinga, wade into the debate, accusing MPs of frustrating devolution. Raila accused the National Assembly of overstretching its mandate by attempting to determine how much goes into county governments.
At a press conference on Friday, November 15, Raila claimed that the standoff would cripple operations at county governments. "The National Assembly is going all out to reduce revenue allocation to counties, in complete disregard of the Constitution and recommendations of the Senate," Odinga asserted.
