Over the last four months, counties have not received their equitable share from the national government. The delays undermine county governments.
The 2010 Constitution introduced a two-tier system of government that comprised the national government and 47 county governments. The devolved system of government is a core pillar in the Constitution and implementation of devolution brought about a major shift in allocation of national resources, and consequently improved access to government services for all Kenyans. It outlines how resources are to be shared between two levels of government.
Despite well-formulated guidelines, we are witnessing a subversion of devolution through systematic under-allocation of funds. In recent weeks, the country has seen a deliberate effort to frustrate the fair and equitable share of revenue to the devolved units.
At the centre of this drive to reverse gains made on devolution, is the Division of Revenue Bill (DoRB) 2023. The National Assembly’s proposed Equitable Share for FY 2023/24 of Sh385 billion is equivalent to 23.03 per cent of the last audited accounts (Sh1,673,715 million for FY 2019/20). The National Treasury argues that the proposed allocation meets the requirement of Article 203 (2) of the Constitution which states that equitable share allocation to counties should not be less than 15 per cent of the last audited revenue. On the other hand, the Commission for Revenue Allocation (CRA) formula to calculate counties equitable share is informed by the actual performance of revenues. The Commission recommends an increment in the allocation to each level of government for the financial year 2023/24. Therefore, the national government allocation should be increased from Sh1,814.8 billion to Sh2,150.3 billion and county governments’ allocation should be increased from Sh370b to Sh407 billion.
County governments, especially those in urban areas like Mombasa, are grappling with insufficient financing and lack of cooperation from national government agencies.
In Mombasa, within days of my assumption of office, the Kenya Revenue Authority placed a caveat on our bank accounts owing to delayed remittance of tax deductions, yet the national government was three months in arrears with the disbursement of the equitable share.
Moreover, national government institutions have neither paid land rates nor Contribution in lieu of Rates since the advent of devolution yet land rates is one of the most fundamental sources of own source revenue for counties.
In Mombasa, there are a number of state corporations undertaking construction projects without seeking approval from the county as provided for in Schedule Four of the Constitution thus further denying us revenue.
The most glaring example of this lack of equity in revenue is that of gambling; the county government is paying salaries to a tune of Sh18 million annually for gaming staff who inspect casinos against paltry revenue amounting to Sh4 million from Single Business Permit fees, yet the government draws Sh100 million in revenue as Excise Tax from these same casinos.
As Mombasa Governor, I am sounding the alarm. Devolution is under siege. It is systematic and well thought out. I call upon the Senate, to play its rightful role and bring a stop to this.
The writer is Mombasa County Governor