Governors take revenue share battle to the Supreme Court

What you need to know:

Parliament failed to pass the Division of Revenue Bill following disagreements between the Senate and the National Assembly, a fallout that has starved counties of cash.
The National Assembly is in agreement with the Treasury to allocate counties Sh310 billion as equitable shared revenue, but the Senate wants Sh335 billion in line with the CRA advise.
The mediation committee, with representatives from the two Houses, failed to reach a deal, prompting the court action.

Governors Monday moved to the Supreme Court seeking its advisory on how the State revenues should be shared out between the counties and the national government after the National Assembly disregarded the recommendations of the Commission on Revenue Allocation (CRA).

Parliament failed to pass the Division of Revenue Bill following disagreements between the Senate and the National Assembly, a fallout that has starved counties of cash.

The National Assembly is in agreement with the Treasury to allocate counties Sh310 billion as equitable shared revenue, but the Senate wants Sh335 billion in line with the CRA advise.

The mediation committee, with representatives from the two Houses, failed to reach a deal, prompting the court action.

“The advisory sought in this reference will help in giving clarity regarding the financing of county governments and the operational space for administrative and legislative action on the same,” said the advisory fronted by Council of Governors (CoG) and the 47 county governments. The governors want the Supreme Court to determine if the CRA's recommendations on equitable share of State revenues are binding, what amounts to a significant deviation from the recommendations and the constitutional effect of the National Assembly and the Treasury disregarding them.

They also want the court to determine whether allocations of the national government in the 2019/2020 financial year as contained in the Division of Revenue Bill violates the Constitution, the consequences of the Senate failing to agree with the National Assembly on the Bill, and the role of the Senators in the proposed revenue sharing law.

National government allocations rose to Sh1.56 trillion in the year starting July from Sh1.36 billion the previous year. Counties equitable revenue share dropped to Sh310 billion from Sh314 billion.

Governors are accusing the Treasury of continuously ignoring the CRA’s recommendations on the sharing of revenue between the national government and counties.