The budget implementation review report by the Controller of Budget has indicted counties for failure to absorb their budgets, especially for development projects.
However, owing to a multiplicity of factors, some of the counties set to gain millions of shillings once the controversial revenue formula is passed are struggling to absorb the billions they have been allocated especially on development.
It appears that the last quarter of this year has been quite unique following the stringent public health measures introduced to curb spread of Covid-19, restricting movement and undertaking of most projects by contractors.
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For instance, Nakuru County government is expected to get an additional Sh700 million as per Commission of Revenue Allocation’s (CRA) formula despite a report tabled during the budget reading indicating that it was unable to spend Sh6.1 billion appropriated for development projects in the 2019/2020 fiscal year.
The County Assembly on Wednesday passed a Sh14.5 billion budget for the 2020/2021 financial year. This comprises of Sh9.75 billion sourced from the county’s current equitable share.
“In addition to the Sh14.5 billion budget, the county has rolled over projects amounting to Sh6.1 billion. The county managed 39 per cent capital expenditure as at June 30 out of the total Sh10.98 billion development budget,” said the Budget Committee chair Joel Karuri. The Assembly and the Executive differed over the centralised procurement system which has been blamed for the delayed implementation of projects.
Last year, CRA set the equitable share for the county at Sh10.48 billion, which was revised downwards by Sh727 million after the outbreak of Covid-19 in the country.
According to the report, the poor performers in absorption rates are Wajir, Nakuru, Kilifi, Lamu, Tana River, Siaya, Nyandarua, Kajiado, Baringo, Samburu and Turkana counties. Absorption rate, a vital tool in determining the efficiency and performance of the counties on utilisation of funds, indicates that majority of counties absorbed less than 50 per cent of their budgets in the first nine months of 2019/2020 fiscal year.
This means they only spent 48.4 per cent of their total annual budgets during the period. Only Narok County managed to absorb over 60.1 per cent of the funds allocated.
However, some of the counties that had higher absorption rates were Kitui, Garissa, Taita Taveta, Murang’a, Mandera, Nairobi, Nandi, Nyamira and Kakamega.
Kakamega spent the highest amount on development projects at Sh3 billion, followed by Mandera and Nairobi counties at Sh2.8 billion and Sh2.3 billion, respectively.
Kakamega Governor Wycliffe Oparanya’s administration spent Sh545.7 million to build bitumen roads, Sh341.2 million to construct the Kakamega Teaching and Referral Hospital, Sh260.8 million on 10km of road per ward and Sh102.5 million for an enterprise resource planning system.
The Nairobi City County government spent Sh300 million on Nairobi regeneration projects, Sh119 million on maintenance of roads and Sh105.5 million on the reconstruction of Jodongo Road.
The county also spent Sh167 million on the construction of roads in Utawala estate.
Mandera County used Sh400 million to tarmac roads, Sh119 million for the IDP housing programmes, Sh112 million to complete the Mandera County Rest House and another Sh100 million to complete the county headquarters.
In the 2018/2019 financial year, counties had set aside Sh190.9 billion (59.9 percent) for development expenditure and Sh285.3 billion (40.1 percent) for recurrent expenditure out of the total budget of Sh476.1 billion.
Wajir, the bottom county in budget absorption rates, spent Sh464 million on grading, bush clearing and gravelling of roads and Sh492 million on overhaul of water supplies and sewerage desilting.
Nakuru County used Sh64 million to buy tippers to facilitate rehabilitation of rural roads, Sh34.6 million for development of a revenue management system and Sh34.6 million to purchase of medical equipment for Nakuru Level Five Hospital.
Murang’a County spent Sh2 billion, representing the highest absorption rate of 60 per cent of the development budget while Tana River County reported 45.6 per cent and Marsabit 43.5 per cent.
Nairobi, Samburu and Nyandarua counties performed poorly, reporting 11.1 per cent, 6 per cent, and 4.1 per cent absorption rate, respectively.