State opposes proposed establishment of county wards development fund

The National Treasury has opposed the County Wards Development Equalisation Bill, 2018, warning that it would usurp the powers of county executives.

The Controller of Budget, Agnes Odhiambo, while supporting the idea of having a framework to ensure there was equitable development in the counties, also opposed the bill, arguing that county assemblies lacked the necessary powers to implement it.

Treasury argued that if enacted, the proposed legislation would entrench inequalities and marginalisation of some communities.

During a public hearing by the Senate Finance and Budget Committee, ministry officials said only a county executive committee member had powers under the Public Finance Management Act to create a fund.

“The sponsor has not explained whether the bill complies with the requirements of establishing such funds as provided in the Public Finance Management Act,” said Chief Administrative Secretary Nelson Gaichuhie.

He argued that the proposed bill runs contrary to the provisions of the Constitution on the prudent use of public finances.

“Counties are distinct entities that derive their powers from the law. These powers do not extend to appropriating funds outside the law,” said Mr Gaichuhie.

He said the proposed legislation offended the constitutional provision on the establishment of public funds.

“If enacted, it could lead to overlaps or duplication of roles and create room for turf wars between departments and the fund, which will impact negatively on service delivery,” Ms Odhiambo warned.

The bill, sponsored by Murang'a Senator Irungu Kang’ata, seeks to establish a fund through which at least eight per cent of the equitable shareable revenue of every county would be allocated for development.

It also provides a mechanism for identifying priority projects in each ward through public participation.

According to Gaichuhie, the Public Finance Management Act gives county governments, through their finance chief executives, the mandate to establish such funds with the approval of county assemblies and warned that establishing such funds was within the purview of the counties and not in the domain of the national legislation.

“The Public Finance Management Act provides the framework for the establishment of such funds and this is not the work of national legislation,” he said.

Gaichuhie told senators that enacting the bill might lead to double allocations in some counties, spread the resources thin, and reduce the capacity of the county government to fund some high-capacity development programmes.

Odhiambo, on her part, asked members of county assemblies to ensure that before approving annual development plans, the county fiscal strategy paper, and the budget estimates, there were projects in every ward.

She also opposed the establishment of ward development boards because both the national and county governments were grappling with a high wage bill because of a bloated workforce.

“This contravenes the principles of prudent use of public resources, as enshrined in the Constitution, and also does not assist county governments to tame the spiralling wage bill,” she said.

Clause 29 of the bill establishes a project implementation committee whose functions include identifying projects to be funded under the Act, undertaking public participation in identifying the projects, submitting ward projects to the board for recommendation to the county assembly for approval, and overseeing and monitoring the implementation of approved projects.