NAIROBI: Fund to give Sh6bn to 14 marginalised counties

Six years after enactment of the Constitution, 14 marginalised counties identified could finally benefit from a fund meant to improve their infrastructure and social services.

The National Treasury says it intends to have Sh6 billion allocated to the Equalisation Fund in the Budget plans sent to Parliament last week.

To get the highest allocations from the fund will be Turkana (Sh645.8 million), Mandera (Sh618.5 million), Kilifi (Sh531.8 million) and Wajir (Sh517.6 million), according to the revenue sharing formula adopted by the Treasury.

Other counties that are set to benefit from the fund include Lamu (Sh185.2 million), Isiolo (Sh229.1 million), Taita-Taveta (Sh269 million) and Samburu (Sh308.4 million).

SPENT BY MINISTRIES

Regulations guiding the use of the fund, prepared by the Treasury, dictate that the money be spent by ministries that manage roads, water, health and electricity.

The State departments will be required to come up with work plans and submit them before the Controller of Budget approves withdrawal of the money from the Central Bank of Kenya.

An attempt to change the Constitution to have the money spent through constituencies is yet to be successful. Members of Parliament from the 14 counties have also been agitating for a change of the regulations.

The Treasury says the approval of the fund’s guidelines, the appointment of an administrator and the opening of an account for it at the CBK will make it possible for the fund to be activated.

Treasury Cabinet Secretary Henry Rotich said 95 per cent of the Sh6 billion — Sh5.7 billion — will be sent to the beneficiary counties as per a formula contained in the policy on the fund.

The remaining amount will be allocated to the counties based on their levels of development, population and land and cover administrative costs.

For development, the Treasury will use the Composite Development Index (CDI) determined by the Commission on Revenue Allocation (CRA). Population will determine how 42.5 per cent of the money is shared while land area will determine distribution of 7.5 per cent of the cash.

However, the Treasury refused to use a CRA formula which had proposed that 50 per cent of the fund be distributed on the basis of development and the remainder shared equally.

Mr Rotich argued that it will not help to reduce the inequalities in counties.

“Poverty measure is not used since it is already incorporated in the Composite Development Index, while fiscal responsibility measure is omitted because data to measure the degree of fiscal responsibility exercised by counties is not available,” said Mr Rotich.

He said the weight of the CDI used in the formula is derived from CRA’s policy on the identification of marginalised areas while the other measures are from the revenue sharing formula already approved by Parliament.