Counties to get Sh48bn more in new Budget deal

What you need to know:

  • County governments could get Sh48 billion more if Treasury’s proposals are adopted.
  • But the National Treasury warns against unplanned recruitment of staff by devolved units.

Counties could get Sh274 billion in the 2015/2016 budget, an increase of Sh48 billion, if proposals by the government are adopted.

This will translate to a 35 per cent allocation, yet the Constitution provides for 15 per cent.

The Cord coalition has been demanding that 45 per cent of the national cake be allocated to the devolved units.

The law demands that the government releases its Budget proposals early to allow for public scrutiny before it is presented to Parliament.

The issue of how much the government should allocate to counties has been controversial with Cord and a section of governors pushing for more funds.

In a budget policy statement by the National Treasury, the government will be relying on the audited 2012/2013 accounts.

“After making adjustments, the County Governments’ equitable share of revenue for the financial year 2015/2016 is estimated to be Sh274.1 billion,” the draft budget policy statement states.

The amount includes Sh253.5 billion released as the unconditional allocation to county governments in accordance with the formula for sharing of revenue approved by Parliament.

The increment will account for 35 percent of the most recently audited revenues approved by the National Assembly.

LAST AUDITED ACCOUNTS

Council of Governors (CoG) Public Relations Officer Barack Muluka on Friday said they would welcome any addition but 43 per cent of audited revenue remains their best target for sound service delivery.

The Treasury notes that the allocation is above the 15 per cent of the latest audited revenues of Sh776.9 billion for the 2012/2013 financial year.

CoG has been pushing for allocation of money to devolved units based on the current budget. However, the national government has maintained that allocations be based on the last audited accounts.

At least Sh193.4 billion was allocated to counties in 2013/2014 before it was increased following year to Sh228.5 billion.

The government is, however, concerned about fiscal management of resources allocated to the counties. It says more should be done to ensure prudent utilisation of the resources for the benefit of the public.

“County governments must ensure resources are used prudently as provided for under Article 201 (d) of the Constitution,” says the report prepared by National Treasury Cabinet Secretary Henry Rotich.

Counties will also get Sh4.6 billion as grants for provision of maternal health care and another Sh2 billion to facilitate leasing of health care equipment.

Other funds include Sh3.3 billion from fuel and Sh8.6 billion as donor loans and grants.

The report also warns against increased recruitment by county governments which the government says may disrupt the county’s fiscal capacities.

“In addition county treasuries should ensure development budgets do not fall below 30 percent of their total additional budgets.”