Counties can’t get any money unless MPs say so, AG Kariuki advises

The National Assembly in session. INSET: Attorney General Kihara Kariuki who has give an advisory on the revenue row. [File, Standard]
The National Treasury cannot release funds to the counties without Parliament’s approval, Attorney General Kihara Kariuki says.

In a legal opinion to the Senate, the government’s chief legal advisor says there is no legal basis, under the current legal architecture, upon which the ministry can administratively advance funds to county governments.

“The onus remains on Parliament to enact an appropriate a legal framework to facilitate the requisite withdrawals from the Consolidated Fund in favour of the county governments,” he says.

He says county governments may access funds from their County Revenue Funds, but only upon authourisation by their local assemblies.

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Justice (rtd) Kariuki therefore advises the parliamentary leadership to reconvene sittings to dispense of the revenue sharing dispute and avert a cash crisis in counties.

“While we note that the two Houses are on recess, we are of the respectful view that the subject matter is of such fundamental public importance that justifies the recalling of Parliament for urgent action in the manner proposed and explained,” he says.

He underscores the need for the National Assembly and the Senate to unlock the impasse on the Division of Revenue Act, which shares revenue between the two levels of government.

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Imminent shutdown

He says Parliament holds constitutional power over the national purse and hence the solution to the imminent shutdown in counties facing a cash crunch lies in its hands.

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Kariuki also proposes that in the interim, Parliament may consider taking legislative measures to authourise the allocation and disbursement of Sh310 billion factored in the current budget or a part of it.

“Our proposal is premised on the fact that the said amount of Sh310 billion is the minimum amount, the availability of which is not contested by any of the parties. What is in contention is whether the amount should be increased,” he writes.

The Senate had sought the AG’s opinion if it is possible for the National Treasury to administratively advance funds to counties. In the advisory dated August 15 addressed to Senate Clerk Jeremiah Nyegenye, Justice Karuiki give his advice on ways to ensure counties are not crippled financially.

“We would therefore advise that Parliament should, as one option and in the public interest, perform its constitutional duty to facilitate the disbursement of funds to the county governments to alleviate a shutdown in operations,” he writes.

The advisory is copied to acting Cabinet Secretary Treasury Ukuru Yatani, Speakers Justin Muturi (National Assembly) and Ken Lusaka (Senate), Controller of Budgets Agnes Odhiambo, Council of Governors chairman Wycliffe Oparanya and Solicitor General Kennedy Ogeto.

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Revenue sharing

The AG said his office takes note of the Public Finance Management (amendment) Bill, 2019, which seeks to empower the Senate to divide among the county governments 15 per cent off all revenue collected nationally, “in the event that Division of Revenue Bill is not passed by the 10th day of June in the proceeding financial year”.

The AG says the Bill is of itself a recognition of the fact that there currently exists no legal mechanism for disbursing monies to the counties in the absence of the Division of Revenue Act.

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Kihara KariukiNational TreasuryDivision of revenue bill