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Eyes on Rotich as counties await Sh77 billion before June 30

FINANCIAL STANDARD
By Rawlings Otieno and Protus Onyango | June 26th 2018
Treasury CS Henry Rotich, [Photo: Courtesy]

With only five days to the end of this financial year, county bosses are grappling with huge debts to clear.

The National Treasury has not released Sh77 billion to  counties to clear debts and other development projects they initiated.

Governors Wycliffe Oparanya (Kakamega), Granton Samboja (Taita Taveta), Alfred Mutua (Machakos) said Treasury has a duty to release the funds within the five remaining days to counties to avoid legal and financial complications.

Financial challenges

The governors said failure to disburse the remaining funds will result in serious financial challenges.

And to cure the ever-recurring delays in the disbursement, Oparanya is now calling for reduction in budgetary allocations to national ministries, departments and agencies to to ensure more money to the counties for service delivery.

“Let us adopt the policy of ‘more county, less national’ in budget allocation. We should also review the fiscal, taxation and economic policy to give county governments’ direct and influential voice in conformity with devolution,” said Oparanya.

He said non-remittance of money owed to counties is making Governors fail in their work.

“If the billions we are owed are released, we will make the lives of our people better by providing services. Now, the money we receive is used to pay salaries. So for months now, no county has undertaken any development project,” he said.

Oparanya said Treasury officials admitted that there is a financial crisis in the country but did not offer solutions to the problem affecting counties.

“They told us during the Devolution Summit that there is a deficit in funds due to the two elections we had last year. But they were at pains to tell us why counties should suffer for mistakes that are not theirs. After all, it is easier to slash national government’s share which is 88 per cent than the counties’ 12 per cent,” Oparanya said.

He said non-payment will lead to serious legal and financial implications which will harm the country.

“Kenya’s debt rating is very bad and will be more affected if the money owed to counties is not paid. This will further affect the Big Four agenda which seems to have nice projects but with no funding mechanisms,” Oparanya said.

According to Mr Samboja, the disbursement they received last Friday was for April 2018, with May and June disbursements totaling to Sh650 million still pending.

“This disbursement will cross to the next financial year. The delay will adversely affect both the recurrent and development expenditure because this money was already budgeted for,” he said.

Mr Mutua said he is expecting just enough to cover salaries and not for any development projects.

“We look forward to the day disbursements will happen as per plan so that financial years can flow well. As a result of the late disbursements, every county will carry over pending bills which is a burden to the common citizen,” said Mutua.

Makueni Senator Mutula Kilonzo Junior accused Treasury of not telling Kenyans that the country is broke and scheming to make counties fail in their mandate.

“I suspect that Treasury carried out the budget cuts on counties without a corresponding amendment to the division of revenue. Treasury refused to admit the country is broke, which is the case,” Kilonzo Junior said

He said that counties are under so much debt.

“Treasury’s action appears to me to be a deliberate way to grind counties to a halt. This financial year, counties have suffered immensely due to the inconsistency in releasing funds. The tragedy is that the Sh77 billion is for development,” the senator said.

He urged governors to take the matter to the Senate so that senators can debate and recommend urgent solutions.

“The failure to release funds has not been brought to our attention as Senate. Governors chose the Devolution Summit as the avenue to sort out the issue which took place last Friday. They should formally bring it to enable us take it up with relevant agencies,” he said.

Worst hit

Kitui Senator Enoch Wambua said the worst hit people in the delay of the disbursements are contractors most of whom have been playing hide-and-seek with suppliers and banks.

“This defeats the logic behind devolution. Devolving funds to the counties is not a favour but a fundamental constitutional duty of the Treasury,” said Mr Wambua.

The county bosses have also decried that frequent changes in the procedure and requirements for county governments funds approved by the Controller of Budget is disrupting delivery of service and which only seems to be affecting counties and not the national government.

Latest today

Last week, Council of Governors (CoG) Chairman Josephat Nanok (Turkana) said if the monies are not disbursed within the week, and latest today, counties run the risk of accruing pending bills which should have been paid within the current financial year.

 “The CoG calls upon the National Treasury to fast track the disbursement of the remaining amounts before June 25, to enable county governments utilise the monies as planned for in the financial year,” said Mr Nanok.

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