Counties received Sh139.3 billion in a similar period last year and the Sh31.8 billion cut this year has delayed suppliers’ pay, workers’ salaries and frozen projects.
Counties have blamed Treasury’s late disbursements for their inability to meet obligations including paying suppliers and contractors in good time.
Treasury allocations to counties in the seven months to January dropped 23 per cent to Sh107.5 billion slowing business and job creation in the 47 devolved units.
Counties received Sh139.3 billion in a similar period last year and the Sh31.8 billion cut this year has delayed suppliers’ pay, workers’ salaries and frozen projects.
Controller of Budget Agnes Odhiambo told Parliament a month ago the swelling pending bills by county governments had reached Sh99.2 billion in the current financial year. Counties have blamed Treasury’s late disbursements for their inability to meet obligations including paying suppliers and contractors in good time.
However, Ms Odhiambo dismissed late Treasury disbursements as merely an excuse for failure to pay suppliers, noting the problem could be linked to counties overstating their revenues and going ahead to commit to suppliers.
In the four months to October, the counties endured a cash crunch following contradictions in the Senate’s approved disbursement schedule and the cash allocation law approved by President Uhuru Kenyatta.
At the close of the first quarter that ended in September, none of the 47 counties had received their allocations, which compelled the Treasury to loan them Sh20.3 billion to pay workers’ salaries.
In the current Treasury release, Nairobi got slightly over Sh8.7 billion, topping the list of counties with highest allocations, followed by Kiambu’s Sh4.3 billion, Kilifi’s Sh4.2 billion, Mombasa’s Sh3.6 billion and Kakamega’s Sh3.4 billion.
Total allocation to the counties in the current financial year stands at Sh329.96 billion, which consists of the equitable share of national government revenue, conditional grants from the State and conditional loans and grants from development partners.
MPs in the previous (11th) Parliament agreed to allocate the counties Sh302 billion in the Division of Revenue Bill saving them an impending operation crisis in the current financial year.
Parliament must first approve the Division of Revenue Bill to pave the way for passage of County Allocation of Revenue Bill.
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