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Over Sh40b lie idle as counties fail to spend on development

NEWS
By James Anyanzwa | July 8th 2014
By James Anyanzwa | July 8th 2014
NEWS
National Treasury Cabinet Secretary Henry Rotich.

County governments are awash with more than Sh40 billion that was never spent during the just concluded 2013/2014 financial year.

This comes even as concerns rise over the persistent under-utilisation of development funds and extravagant spending by Members of the County Assembly (MCAs).

According to official data from the National Treasury, Sh40.44 billion currently lie idle in the Revenue Fund accounts of the devolved units. Of this, about Sh14.34 billion is part of the equitable share of the revenue raised nationally. About Sh26.09 billion constitutes part of the county government’s own revenues collected and banked in the County Revenue Fund and other government’s bank accounts maintained at the Central Bank.

Of the equitable share of revenues, the lion’s share of the unspent funds are for development at Sh11.82 billion, with only Sh2.52 billion of the recurrent spending left unutilised at the closure of the 2013/2014 financial year on June 30, this year. According to Treasury, Turkana County led the pack of the biggest non-spenders with its total bank balances as a proportion of total equitable share of revenues standing at 50 per cent. It was followed closely by Lamu County (49 per cent), Mandera (49 per cent) and Tana River (46 per cent).

Other notable slow-spenders included Garissa (39 per cent), Kitui (38 per cent) and Kilifi (36 per cent), Siaya (33 per cent) and Kwale (32 per cent). The big spenders included Machakos County with the proportion of total bank balances against total equitable share of revenues standing at one per cent. Others are Bomet (four per cent), Kiambu (six per cent), Migori (eight per cent), Uasin Gishu (eight per cent) and Nyeri (nine per cent).

On-going projects

The Council of Governors, however, denied claims that the funds, which are lying in their bank accounts, are idle, saying most of these funds have already been budgeted for on-going projects. “The claim the money is idle is untrue. Most of this money has already been committed by various counties on several projects. Some of these projects are still-ongoing,” said Isaac Ruto, Bomet County Governor and chairman of the Council of Governors.

 

“This money is committed and waiting to be paid out on various projects. The money is for goods and services that have already been procured by the counties but awaiting delivery to the counties by the various suppliers.” National Treasury Cabinet Secretary Henry Rotich concurred with Ruto.

In the last financial year (2013/2014), Treasury said it released between Sh15 billion to Sh20 billion every month facilitate the operations of the devolved units of government. However, there are concerns that the release of funds to the County Revenue Funds by Treasury has been unpredictable, with counties unaware on when the next disbursement of funds would be effected. The delays affected budget implementation by the counties who were forced to reschedule planned activities.

According to the office of the Controller of Budget (OCOB), Treasury was expected to disburse on a monthly basis to the County Revenue Fund accounts as per the cash disbursement schedule approved by the Senate.  The State was expected to have disbursed Sh148.9 billion to the counties by March 31, 2014.

However, only Sh110.1 billion had been disbursed by the end of March 2014.  OCOB’s Quarterly Budget Implementation Report shows that only three counties of Bomet, Machakos and Nairobi had received their allocation for February 2014, with no county receiving its allocation for March 2014 by the end of the quarter.

During July 2013 to March 2014 period, the Controller of Budget approved transfer of Sh110.1 billion from the Consolidated Fund to the various County Revenue Funds.

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