The national government’s failure to distribute about Sh100 billion inequitable share and conditional funds for the current fiscal year places counties at risk of having their operations affected.
Governors are already expressing concern that with only four months to elections, they may not be able to achieve their five-year development goals unless the government rapidly disburses funding.
As of late this month the National Treasury owes the regional governments Sh59.97 billion in fair share and another Sh39 billion in conditional grants.
The affected counties are Baringo, Kwale, Lamu, Migori, Nairobi, Nakuru, Samburu, Tana River, Turkana, Uasin Gishu and West Pokot.
Some thirty-one counties are owed Sh22.1 billion in allocations for February, while all the counties have yet to receive their March share of Sh29.6 billion.
This implies that counties are unable to pay for drugs, water, and electricity, as well as carry out development initiatives in important sectors like maternal healthcare, road construction and maintenance, youth empowerment, and the construction of polytechnics and early childhood education centers.
As a result of the pending bills, suppliers and contractors have not been paid.
Counties have also been unable to publish tenders for development projects due to the standoff.
County governments are required by law to receive at least 15 percent of the government’s audited revenues. The law ensures that the national government’s equitable portion of revenue is distributed on schedule.
Grants with an outstanding amount inequitable share are Sh29.6 billion owed to all the 47 devolved units for the month of March alone, Sh22.1 billion owed to 31 counties for February, and Sh8.2 billion owed to eleven counties for January.
For the month of March alone, Sh29.6 billion inequitable share is owed to all 47 devolved units, Sh22.1 billion to 31 counties in February, and Sh8.2 billion to 11 counties in January.
IDA (World Bank) for the Kenya Climate-Smart Agriculture Project (Sh7.8 billion), Sh6.4 billion (World Bank credit) for the National Agricultural and Rural Inclusive Growth Project, and IDA-Water and Sanitation Development Project are among the grants.
However, the national Treasury blames a stalemate between Senate and National Assembly over the creation of the County Governments Grants Bill 2021 for the delay to release conditional grants.
The County Governments Grants Bill 2021 provides a legal framework for the release of conditional allocations financed from loans and grants from development partners.
Laikipia Governor Ndiritu Muriithi said delayed disbursements mean pending bills will continue to accumulate.
He urged the Treasury to develop innovative ways of releasing the cash, warning that further delays would slow down economic activity.
“We have a crippling drought that requires the counties to run emergency activities like buying relief food which we cannot, because of cash flow problems.
We are weeks to the closure of the financial year, meaning even if the money was to be released now, it might not be fully utilised, considering that we are in an electioneering period,” Ndiritu told a local TV station.
The governors have also protested against the delay in passing the County Governments Grants Bill, 2021, which has further aggravated the situation in the counties as they have yet to receive conditional allocations for this financial year.
But even as they protest, 13 counties are undermining devolution by spending virtually all the resources they get on salaries and allowances while ignoring development projects, Controller of Budget (CoB) Margaret Nyakang’o has said.
The devolved units, a majority of which are led by first-term governors, have been faulted as what they spend on salaries and allowances is 100 times more than what they invest in activities that could improve people’s lives.