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County assemblies may soon be funded directly by Treasury

COUNTIES
By Stephen Makabila | June 21st 2015

Controller of Budget Agnes Odhiambo holds the final word on whether the 47 county assemblies will be funded directly by the National Treasury from July, giving them full financial autonomy from governors and their county executives.

Senate Committee on Finance, Economics and Budget chairman Billow Kerrow says the request by wards for direct funding  from Treasury was forwarded to the Commission of Revenue Allocations (CRA) by the Senate and is currently being assessed by the Controller of Budget.

If approved, county assemblies could receive their funds through their operational accounts for the first time.

“If the Controller of Budget approves, the funds will go directly to operational accounts of the county assemblies from July, not the county treasuries,” said Kerrow. The Senate’s County Allocation of Revenue Bill 2015 and the Division of Revenue Bill 2015 will determine how much each of the 47 county governments will receive from the Sh283 billion allocated for the 2015-16 financial year.

Earlier in the week, the committee recommended that 34 county assemblies receive an additional Sh2.5 billion for operations after the County Assemblies Forum (CAF) petitioned the Senate for an extra Sh4.4 billion.

CAF argued that the Sh25 billion allocated to them for salaries and operations was inadequate.

Senators have in the past complained that county assembles were not doing a good job in providing oversight over county executives. However, CAF says a Bill by Senate Devolution Committee Chairman Kipchumba Murkomen would provide them more autonomy as CAF will be funded directly by the treasury.

Senator Murkomen’s County Government (Amendment) (no.3) Bill, 2014 has already gone through the second reading in the Senate.

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Growth and stability

In the past year, the Controller of Budget assigned personnel to help counties develop their budgets because they lacked expertise.  However, their ability to developed budgets has improved and this has been acknowledged by civil society groups.

In Nairobi County, which has the biggest budget in the country, the Institute for Social Accountability (Tisa) notes that the draft budget for 2015-16 outlines a strong vision for growth and macroeconomic stability.

But Tisa says the county should revise its budget downwards from Sh15.5 billion to Sh11 billion because raising the proposed amount of revenue will be difficult.

“According to the World Bank, Nairobi County used to collect Sh8.6 billion under the defunct city council. The county could look at expanding its revenue base by taking advantage of Kenya Revenue Authority (KRA) Agency system of revenue collection already in place across all 47 counties at a charge of two per cent of revenues collected,” added the Tisa report.

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