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CRA proposes hefty Sh367b allocation for counties next year

BUSINESS
By Otiato Guguyu | November 10th 2016
By Otiato Guguyu | November 10th 2016
BUSINESS
Chairman of the Commission on revenue allocation Mr.Micah Cheserem speaks at the KICC on Thursday,April 26 during a press briefing on the launch of the horizontal share formula for money to the 47 counties. PHOTO:COLLINS KWEYU/STANDARD

A State agency has proposed the biggest allocation yet for the counties, though less than what the governors have demanded.

Proposals by the Commission on Revenue Allocation (CRA) may see the devolved units get Sh367.5 billion next year, up from Sh298.3 billion this financial year.

This represents 22 per cent of the revenue projections for 2017/18, which stand at Sh1.4 trillion, a far cry from the 45 per cent demanded by governors under the Pesa Mashinani push.

“The commission hereby recommends that Sh331.5 billion be allocated to counties as equitable share and Sh35.9 billion as conditional grants for 2017/18,” says CRA chairman Micah Cheserem in a letter to Parliament.

The commission, in a review of its revenue sharing policy, gave counties a Sh69 billion windfall mainly for roads and libraries.

Out of this amount, Sh8.4 billion will go to construction of new roads while the share of fuel levy will triple from Sh4.3 billion to Sh13.2 billion.

Mr Cheserem said the Kenya Roads Bill of 2015 was flawed as it had given counties insufficient funds to maintain the 121,456km of roads under county governments.

“The 15 per cent of revenue allocated to county governments for the road maintenance levy fund is not adequate to maintain county roads,” he said in the letter to Parliament.

He proposed the Bill be amended by increasing the allocation to county governments from 15 per cent to 25 per cent and reducing the allocation to the Kenya Rural Roads Authority from 21.8 per cent to 1.53 per cent.

The 44 libraries under county governments will get Sh319 million next year for salaries, staff allowances and operations. This is in addition to Sh400 million for the construction and equipping of libraries in 20 counties.

Last year, counties received Sh200 million under the County Allocation of Revenue Act for libraries.

CRA also allocated additional funds for establishment of two regional cancer referral centres costing Sh2.5 billion each and Sh1 billion for the establishment of a national cancer drug access programme.

Tharaka Nithi, Nyandarua, Isiolo, Lamu and Tana River will each get Sh800 million to build county headquarters over the next three years.

CRA has set aside Sh1 billion for each of the years beginning 2017 for the five counties and Sh1.5 billion for rehabilitation of village polytechnics. The increased allocation might, however, seep through gaping budget deficits as counties fail to meet their own revenue allocation targets.

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