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Delayed funds to counties, a crude way to kill devolution

By Kamotho Waiganjo | Jul 2nd 2021 | 3 min read

It is impossible to spend money released on the last day of the financial year. [Elvis Ogina, Standard]

At about 6pm on June 30th, 2021, the last day of the financial year 2020/21, many counties received the bulk of the funds that have been outstanding from the National Treasury. This was a cruel joke on Kenyans by the otherwise affable National Treasury Cabinet Secretary Ukur Yatani.

Everyone who knows how the financial system at the Treasury works, including the mandatory approvals from the Controller of Budget and IFMIS switchings, knows such last-minute payments are cynical obedience of the letter of the law.

It is impossible to spend money released on the last day of the financial year. This travesty is now part of the annual tradition defining Kenya’s devolution. By April this year, a whopping Sh108 billion had not been paid to the counties. After an outcry by the CoG in April and a threat to shut down services, the Treasury released about Sh45 billion in early June.

The last-minute payment this week was made after another hard-hitting statement from the CoG. What makes it sad is that the current Treasury Cabinet Secretary has been a governor and understands the tragedy that Kenyans, not just county governments, face when funds are delayed. The CS knows counties spend about 65 per cent of their allocations on recurrent expenditures which include salaries, medicines and such supplies and this is the only amount that the Treasury had released by May this year.

The effect of this late disbursement is that counties are absolutely unable to implement any development programmes. The government touts the trillions sent to counties and asks governors to show what they have done, not disclosing that what is released on time is just enough to pay recurrent expenditure. When devolution commenced in 2010, the first Jubilee administration’s fight with governors was about transfer of functions, never about delayed disbursements.

Consequently, the impact of devolved government was felt robustly in the furthest corners of the republic. West Pokot built hospitals. Machakos built roads. Murang’a provided support to farmers.

The second Jubilee administration has backpedalled on this issue with clockwork regularity. Among the debilitating impact of this non-disbursement is the impoverishing of local entrepreneurs who provide services to county governments.

The much-publicised “pending bills” are the guillotine by which the local grader of rural roads, the contractor of local markets and the supplier of murram have been executed.

When the ministry gives endless edicts about non-payment of pending bills but does not release sufficient funds to pay these bills and other county expenses, the latter take priority otherwise doctors and other staff would go on strike.

I used to believe these delays resulted from scarcity of revenue. I am now getting more convinced that it is part of an ideological commitment to weaken devolved units. It is a return to centralism, to the good old days when we all looked up to the central government to provide funds and services.

I say this because key ministries at the national government continue to get their revenue on time despite the much-touted cash crunch. It is devolution, with its meagre allocations that is left to wait for the crumbs when everyone is satisfied.

What those at the centre forget is that what keeps holding this country together is not the promise of BBI, or the much-touted promise of hustler takeover, another cruel joke on Kenyan.

It is the belief that they will get a share of the national cake which is largely supplied through the devolved system. Deny this to the people and you should not be surprised when they demand the same forcefully. Can someone please encounter a Damascus road moment and get devolution back on its financial sufficiency track?



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