Peter Munya accuses Treasury of releasing funds irregularly

County governments are in the red after the National Treasury failed to disburse funds to them on time.

Governors have expressed concern over the late disbursement of county funds by the Treasury which, they say, affects service delivery.

Council of Governors chairman Peter Munya said the devolved units had only received money up to April.

"Shockingly, the National Treasury released to some County Revenue Funds money meant for May as late as Thursday, 25 June 2015. Article 207 (3) of the Constitution of Kenya, 2010 provides that county governments cannot withdraw money from the County Revenue Funds unless the Controller of Budgets has approved that withdrawal," Mr Munya said.

In a statement released on Sunday, Mr Munya added: "Naturally, this process of requesting the Controller's approval takes a minimum of three working days before the approval is taken to the Central Bank of Kenya where it takes another one working day before such money is available for County Governments' expenditure."

As a result, he said, the counties would not be able to access the May and June allocations.

RELEASING MONEY IRREGULARLY

Mr Munya, who is also the Meru governor, accused the National Treasury of continuing "to ignore the provisions of the Constitution of Kenya, 2010 and the Public Finance Management Act, 2012 by releasing money irregularly to the County Governments".

"The result of this has been poor cash flow planning at the county governments, therefore hampering absorption of the said funds," Mr Munya said.

He said the National Treasury was supposed to have released the monies, including those for April on and not later than 15 April 2015.

"The National Treasury is therefore in breach of the Constitution and the law. County governments will close the year on 30 June 2015 and prepare a refund statement pursuant to Section 136 of the Public Finance Management Act, 2012," Mr Munya said.

He said the counties will have to report that "they have huge balances in their bank accounts held at the Central Bank of Kenya and the National Treasury will in turn publish in the dailies those balances".

He regretted that while the National Treasury is obligated under the provisions of the Public Finance Management Act, 2012 to publish exchequer releases on a quarterly basis, "they do not in fact state that they release monies late to the county governments".

"Such publications communicate negatively to the public who read that the county governments hold large bank balances at the Central Bank of Kenya and that therefore they are not using the funds," Mr Munya said.

He said the public should know that the Exchequer is deliberately breaching the provisions of the Constitution and the Public Finance Management Act, 2012.

Article 219 of the Constitution states: "A county’s share of revenue raised by the national government shall be transferred to the county without undue delay and without deduction, except when the transfer has been stopped under Article 225."

Section 17 (6) of the Public Finance Management Act adds that: "The National Treasury shall, at the beginning of every quarter, and in any event not later than the fifteenth day from the commencement of the quarter, disburse monies to county governments."

Consequently, the County Allocation of Revenue Act, 2014 in Section 4 (2) provides that each county government's allocation shall be released in accordance to Section 17 of the Public Finance Management Act, 2012.