President Uhuru Kenyatta and Opposition chief Raila Odinga yesterday dangled Sh50 billion in front of intransigent senators, as the revenue sharing deadlock entered a penultimate stage.
In a meeting that excluded Deputy President William Ruto, Uhuru and Raila summoned the Senate leadership to State House, offered a sweet-sour deal that split the lawmakers and shook the prevailing camps on the matter.
Immediately the deal filtered through, a group of senators under the “Team Kenya” banner opposed it, while expressing fears that State House was luring its membership.
The billions are predicated on performance of the economy, and with the battering it has received from the Covid-19 pandemic, it is doubtful that the State will be in a position to implement it.
Senators Samuel Poghisio (Majority Leader), Irungu Kang’ata (Majority Whip), James Orengo (Minority Leader), Fatuma Dullo (Deputy Majority Leader), Beatrice Kwamboka (Deputy Minority Whip) and Mwashushe Mwaruma (Taita Taveta) attended the meeting.
“The meeting resolved that depending on the financial performance of the economy, the government will, in the next Financial Year (2021/22), endeavour to allocate an additional Sh50 billion to counties as part of efforts to strengthen devolution,” reads a statement by State House spokesperson Kanze Dena-Mararo.
The State House meeting, also attended by Council of Governors (CoG) chairman Wycliffe Oparanya came in the wake of complaints by senators that they were unable to access the president to get a firm resolve.
Ruto, who chairs the Intergovernmental Budget and Economic Council (IBEC) meeting with governors, was absent at the crucial meeting to unlock the stalemate that has delayed the passage of the County Allocation of Revenue Bill to allow for equitable sharing of Sh316.5 billion among counties.
The advance deal is said to have been brokered by Kang’ata and Nyamira Senator Okongo Mogeni at a meeting in hotel in Parklands on Saturday ahead of the State House meeting. Before then, Kang’ata was the face of Senate failure in brokering the deal.
The Sh50 billion commitment by the government was the first following failed talks to get an actual progress figure if the disputed third basis generation formula, that has sharply divided senators, was to be passed.
With this undertaking on the table, the president required the senators to urgently resolve the revenue sharing stalemate at the Senate to avoid disruption of service delivery in the counties.
However, the ‘sweet deal’ negotiated by six senators on behalf of the 47 counties, immediately faced opposition, with those against increased allocation to populous counties reading mischief.
Kitui Senator Enoch Wambua, a member of Team Kenya, claimed it would be better to plan with what they have at hand, since Covid-19 has hit economies globally.
“In view of the stated uncertainty and the reality of a global economic slump, it would be better to plan with what we have. Should the economy improve, and I pray it does, nothing stops the Senate from revisiting the basis and passing a resolution to amend,” Wambua said.
Narok Senator Ledama ole Kina said: “We will not support anything that says depending on the economy or endeavour. The Senate is the one tasked with the responsibilities of allocating funds, not the president.”
The State House meeting trashed the two weeks’ deliberations by the 12-member mediation committee, led by senators Johnson Sakaja (Nairobi) and Moses Wetang’ula (Bungoma).
The committee was unable to get a commitment from National Treasury Cabinet Secretary Ukur Yatani to a progressive increment in allocation from the next budget from Sh316.5 billion to Sh325 billion, Sh333 billion and Sh341 billion as provided for in the Budget Policy Statement.
Left with no choice, the committee tabled two options; one, that the baseline for allocation be capped at Sh273 billion, mirroring that one proposed by Meru Senator Mithika Linturi and backed by a majority of the senators, retaining the old figures, while over and above be subjected to the new proposals.
The second option was mainly derived from Kiambu Senator Kimani Wamatangi’s seeking to include additional factors such as pastoralism, livestock, blue economy, extractive industries and wildlife and conservation.
The committee had noted that Orengo’s proposal was futurist, however, Wamatangi’s recommendation cures some of the concerns through his 50 per cent proposal to cushion losing counties.
“This means in the subsequent year after the formula comes into effect, a county like Nandi that is set to receive Sh1.4 billion additional allocation, will lose Sh700 million, which will be shared among the losing counties,” said a senator.
However, the irony, according to senators, was that President Kenyatta’s meeting also glossed over the same because in the event the economy does not improve, counties will continue to get less funds.
“The meeting at State House decided to increase allocation by Sh50 billion but with no modalities to cushion the losing counties. The parameters are not balancing. Some counties might lose a lot in the subsequent years. For instance, a county getting Sh10 billion of the Sh316.5 billion will get Sh9 billion if the allocation goes up to Sh370 billion,” said a senator.
The irked senators accused Kang’ata of selectively choosing his negotiators to bid for nominated Senator Petronilla Were’s formula, which seeks to freeze implementation of the disputed revenue sharing formula, until counties vote is increased to Sh348 billion, only that in this case the increase is by Sh50 billion instead of Sh31.5 billion.
Deputy Majority Leader Cleophas Malala, Minority Whip Mutula Kilonzo Jnr and Deputy Majority Whip Farhiya Ali, all Team Kenya members, did not attend the meeting. Dullo, an avowed member of the group, attended.
“A meeting without the Speaker, who is the judge, part of leadership sidestepped and the mediation committee axed, how will they get the buy-in of the House? A consensus should have been built through the Speaker’s ‘Kamukunji’ before the Order is tabled on the floor of the House,” said another senator.
The House Business Committee was delayed yesterday as the Speaker and members waited for their colleagues to conclude the State House meeting.
Uhuru and Raila’s last minute ditch to carry the day is against Linturi’s proposal, backed by Ruto, to cap the equitable share at Sh270 billion and the difference of Sh46.5 billion be subjected to the Commission on Revenue Allocation (CRA) proposal.
The CoG has also officially voiced its support for the Were formula.
“Counties are waiting for a decision; there is a falsehood out there that the Senate has failed to pass the crucial formula. I want Kenyans to know we are very eager and anxious to pass the formula,” said Elgeyo Marakwet Senator Kipchumba Murkomen.
Wamatangi however claimed the mediation committee did not do its work because their negotiations collapsed.
“This is because senators were bored. Thereafter a consent was entered yet the senators in the committee did not agree.”