Why counties missed out on State funding

The National Treasury has published a statement explaining why it starved counties of Sh10 billion in the last financial year that ended June.

Through Principal Secretary Julius Muia, the Exchequer noted the cash was not disbursed to the devolved units after they failed to comply with a number of conditions.

The revelation that counties never received all their money in the 2018/19 financial year comes at a time when a gridlock between the two houses of Parliament has seen them go without a single cent from the Exchequer in July. The 47 county governments received Sh360.1 billion, representing 96 per cent of the County Allocation of Revenue Act (CARA), 2018 allocations.

Delay by the Ministry of Water officials to prepare documents to unlock disbursement of some conditional grants was one of the biggest reasons the devolved units never received all their money.

This saw counties lose Sh3.8 billion for the Water and Sanitation Development Project and another Sh880 million for the Water Tower Protection, Climate Change Mitigation and Adaptation Programme.

Mr Muia blamed what he said was a failure by accounting officers of some ministries responsible for specific conditional grants to submit written instructions in time to the National Treasury for the failure to release payments.

"The need for written instructions is stipulated in the Guidelines for the Management of Intergovernmental Fiscal Transfers (2017),” he said. Other funds that the counties were allocated but never received included Sh2.3 billion from the World Bank as part of the four-year, Sh20 billion Kenya Devolution Support Programme (KDSP) aimed at supporting capacity building and technical assistance at the county level.

According to Treasury, an adjustment in the amount that was to be paid to county governments against one of the disbursement-linked indicators was the reason the money was never disbursed.