Treasury Cabinet Secretary Ukur Yattani has escalated the row between the Treasury and the county governments after he announced a move to further slash fundings to the counties.
A report from the Business Daily on Monday, January 27, indicates that the CS is proposing to cut the equitable share for counties to Ksh317.8 billion down from the Ksh321.7 billion recommended by the Commission for Revenue Allocation (CRA) for the financial year starting July 1, 2020.
According to the publication, the CRA had recommended a Ksh5.2 billion addition to the Ksh316 billion given to the counties in the year 2019/2020 to carter for development projects, while the recurrent 2019/2020 budget is retained at the same level.
The Treasury, however, lamented that increased obligations such as debt payment, pensions, gratuities and salaries for constitutional and independent commissions have weakened its ability to raise the equitable share demanded by the counties.
CS Yattani, however, declared that the floor was open to discussions with a view to getting a way forward on the contentious issue.
"To deal with the divergent recommendations by the National Treasury and the CRA further engagements are scheduled to take place under the auspices of the Intergovernmental Budget and Economic Council (IBEC)."
"These engagements will, amongst other things, seek to avert a stalemate in the Financial Year 2020/2021 division of Revenue process, the kind that took place in Financial year 2019/2020," Yattani was quoted.
On July 15, 2019, all the 47 Governors, Senators, and MCAs marched to the Supreme Court to seek an advisory opinion on how the 47 counties should share revenue from the national government and resolve the superiority conflict between Senate and National Assembly over budgetary allocation to counties.
This march was occasioned by the Senate supporting the proposed Ksh335 billion to be allocated to the counties while the National Assembly approved only approved Ksh316 billion.
After settling on a final figure of Ksh327 billion, the governors lamented that the Treasury was still relenting on releasing the money to the counties.
On September 17, 2019, President Uhuru Kenyatta signed the Division of Revenue Bill 2019 paving the way for the release of Ksh378.1 billion to the counties.
Out of the total allocation, Ksh316.5 billion was the equitable share of national revenue while Ksh61.6 billion was conditional allocations to the devolved units.
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