Counties caught between rock and hard place in cash spat

It will now be a delicate balancing act for cash-strapped counties in managing their finances following President Uhuru Kenyatta’s declaration that the national government does not have money to grant their demand for Sh335 billion.

FINANCIAL CRISIS

The President’s stand on the matter has put counties in a tight spot with governors now blaming political brinkmanship on the stalemate.

Already, the county bosses have indicated that they will not relent in their demands for more allocations, further straining relations between the two levels of government.

“Our position is that if we have to provide the services that we are supposed to, Sh335 billion is a comfortable figure. We must be funded, whatever happens. It is now up to the Senate and the National Assembly.

“During the inaugural county government, we had the Pesa Mashinani Initiative that failed. But this time round, we will roll out the Ugatuzi Initiative to seek amendments to the Constitution,” Council of Governors Chairman Wycliffe Oparanya said.

He warned that critical services such as health, agriculture, water and infrastructure are likely to be hampered if the National Assembly and the Senate do not come to a compromise. The National Assembly has already passed the republished Division of Revenue Bill with Sh316 billion as equitable allocation to the counties signalling another round of mediation with the Senate.

Public servants in the 47 counties may not receive their July salaries on time, with unions threatening  work boycotts should this happen.

The Kenya County Government Workers Union (KCGWU) has waded into the issue and now wants governors to accept the Sh316 billion offer.

Secretary General Roba Duba on Friday said governors should save counties from falling into a financial crisis and accept the proposed Sh316 billion, which is the amount of funding that is currently approved.

“We have seen county audit records and the wastage witnessed is a clear indication that governors are misusing funds, I don’t know why they want to be added more. Any move to delay workers’ salaries will be resisted and counties should prepare to face the wrath of workers if they try that,” said Mr Duba.

CREATED MISTRUST

The Sunday Nation has learnt that the cash crisis is so dire that some counties are even finding it hard to fuel vehicles.

Governors also cautioned that they were failing to provide services on time due to cash constraints. Projects that risk stalling include maternal healthcare, road construction and maintenance, youth empowerment and construction of polytechnics and early childhood education centres.

They said the slow progress of development projects has created mistrust within the public.

Nyeri Governor Mutahi Kahiga asked the national government and MPs to respect counties and quit frustrating residents by denying them funding.

Mr Kahiga, while rewarding departments in his administration that had performed impressively in collection of revenue, said that counties were doing their best to boost their own-source revenues.

“Devolution for heaven’s sake is not a privilege. It is constitutional and mandated by law. It is unfortunate when other levels of government think they are doing counties a favour and we are demanding that money comes to the counties so that we do what we are supposed to in delivery of services,” Mr Kahiga said.

Laikipia Governor Ndiritu Muriithi said the division of revenue stalemate should be treated with the seriousness it deserves.

ANNUAL ALLOCATION

“Division of Revenue is a constitutional, not a presidential prerogative,” Governor Muriithi, an economist, told the Sunday Nation.

Deputy President William Ruto, while speaking in Korr, Marsabit County, called for dialogue between parties involved in the allocation of revenues to counties.

His statement came a day after President Kenyatta said the government has no extra cash to give counties.

According to the DP, a long-lasting solution to the standoff would be healthy for the development of the country, adding that the national government and counties need to hold talks to ensure development projects do not stall.

“I urge governors, senators and members of the National Assembly to sit down and find a solution so that we can fulfil our duty of serving Kenyans,” he said.

According to the Constitution, once every five years, the Senate shall, by resolution, determine the basis for allocating among the counties the share of national revenue that is annually allocated to the county level of government.

And in determining the basis of revenue sharing, the Senate should request and consider recommendations from the Commission on Revenue Allocation, consult the county governors, the CS responsible for finance and any organisation of county governments and invite the public, including professional bodies, to make submissions to it.