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Economy

Push to safeguard county cash after Parliament row

 Council Of Governors
The Council Of Governors members led by chairman Wycliffe Oparanya addressing the press on the Ugatuzi Initiative issue on Division of Revenue. FILE PHOTO | NMG 

Counties will automatically receive their Constitution-guaranteed share of public funds if a proposed law that seeks to shield the devolved units from revenue standoff in Parliament sails through.

The Senate will have the power to authorise disbursement of cash equivalent to 15 percent of the most recent audited accounts of the revenue raised and approved by the National Assembly in case of future stalemate.

The Public Finance Management (Amendment) Bill, 2019 sponsored by Kikuyu MP Kimani Ichung'wah states that the resolution by Senate will be legally binding on the Treasury and MPs will not need to vote to approve it.

Counties are currently entitled to at least 15 percent of all national government revenue under Article 203(2) of the Constitution but Senators and MPs must agree on the Division of Revenue law before any cash can be appropriated.

“In the event that the Division of Revenue Act for the next financial year has not been passed by Parliament by the tenth day of June of the preceding financial year, the Senate shall, by resolution, divide 15 percent of all revenue collected by the national government among the county governments within seven days in accordance with the most recent resolution made by Parliament under Article 217 of the Constitution,” the bill reads.

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Last week, senators agreed to Sh316 billion share to be disbursed to counties, ending close to two months of a stand-off that had pushed the counties a to cash crunch.

The impasse caused cash crisis in counties leading to strikes over salary delays early last month. Governors had last month threatened to shut down operations in the counties to protest the impasse as senators held out for Sh335 billion.

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