Counties

Nairobi County sets aside Sh246m for MCAs car grant

City-hall

City Hall: “County taxation will breach well known principles of fiscal efficiency.” Photo/FILE

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Summary

  • Nairobi County Assembly has set aside Sh246 million in its supplementary budget to cater for car grant for its members, becoming the first assembly to implement the BBI carrot dangled by President Uhuru Kenyatta.
  • The new development will now see car loans advanced to the 122 MCAs at the city assembly converted into car grants.

Nairobi County Assembly has set aside Sh246 million in its supplementary budget to cater for car grant for its members, becoming the first assembly to implement the BBI carrot dangled by President Uhuru Kenyatta.

The new development will now see car loans advanced to the 122 MCAs at the city assembly converted into car grants.

Interestingly, the supplementary budget was tabled on the same day the assembly was set to debate the Building Bridges Initiative (BBI) Constitutional Amendment Bill, 2020, which was unanimously approved by the House with 114 members voting in support of the bill.

Assembly Clerk Edward Gichana said the move follows the presidential pronouncement on the issuing of Sh2 million car grant to MCAs and speakers of county assemblies.

Thereafter, the Salaries and Remuneration Commission (SRC), through circular dated February 9, 2021, provided guidelines on implementation of the conversion of car loan grant.

“In honour of this directive among other financial obligations this supplementary will focus to address the following… additional of Sh246 million for transfer of funds to the County Assembly Fund account to cater for car grant,” said Mr Gichana.

In late January, in a meeting with MCAs from Mt Kenya region to drum up support for BBI bill, President Kenyatta pledged to help MCAs achieve their demands for a Sh2 million car grant each.

Early last month, SRC gave a thumbs of approval for Sh4.5 billion car grants for MCAs and their Speakers, paving the way for its implementation.

The Commission’s Chairperson Lyn Mengich said they had reviewed and directed the conversion of the car loan benefit to a transport facilitation benefit in form of a grant for the MCAs.

The SRC said conversion of the car loan facility to a car grant will be undertaken within the available car loan facility funds of Sh4.5 billion and will not affect the counties’ expenditure ceiling.

According to the SRC, MCAs are entitled to car loans of up to Sh2 million payable at three percent interest within their term in office.

“Upon conversion, the existing car loan shall cease and the speakers and Members of the County Assembly who have already benefited on the existing car loan shall convert their car loan to transport facilitation benefit in form of a car grant,” read in part the letter.

But after the approval, Kenya Revenue Authority (KRA) said they are looking into getting a pie of the cake advanced to the MCAs.

KRA Commissioner General James Mburu said the taxman is looking into car grant with a view to taking 30 percent from the grant, a move that if effected, will leave the beneficiaries with only Sh1.4 million from the initial Sh2 million.