CRA warns of crisis in counties over cash sharing formula
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- She said CRA had gone back to the drawing board in order to come up with a formula that would be agreeable to all and avoid bringing the country to a standstill after the expiry of the three -year period.
- She warned that the expiry of the November deadline might lead into a crisis, but remained optimistic of beating the constitutionally set date.
- Ms Osoro cautioned some of the counties against 'backdoor’ borrowing, saying they wanted to come with a borrowing framework approved by the government and other agencies.
The Commission on Revenue Allocation (CRA) is racing against time to draw a new sharing formula for counties after an earlier one was rejected by the Senate.
Speaking in a Naivasha hotel on Monday, during a decentralisation workshop, CRA commissioner Rose Osoro said the expiry date of the current sharing formula was November.
She said a new formula needed to be approved in three months, but downplayed of a possible “cash crisis” if they failed to get a nod from the Senate.
“We still have a few more months to deliberate and get a formula that can properly and equitably distribute resources to the counties,” said Ms Osoro.
She said CRA had gone back to the drawing board in order to come up with a formula that would be agreeable to all and avoid bringing the country to a standstill after the expiry of the three -year period.
She warned that the expiry of the November deadline might lead into a crisis, but remained optimistic of beating the constitutionally set date.
“Probably the earlier formula was rejected as there was little consultation with the Senate to understand issues surrounding the resources sharing formula,” said the CRA commissioner.
Senators insisted that a proposal presented by the CRA disregarded the needs of some counties.
They however supported sharing some of the funds equally among the 47 counties, saying the move would cushion counties with limited population and land mass.
Ms Osoro called on the counties to match the collected resources with service delivery.
“It is a common practice to find some of the counties collecting revenues and not offering any kind of services at all,” she said.
Ms Osoro cautioned some of the counties against 'backdoor’ borrowing, saying they wanted to come with a borrowing framework approved by the government and other agencies.
“This will enable counties to borrow within the given framework instead of what we are currently witnessing and seeing from the books,” she said
Ms Osoro said some of the issues they would be looking at during the week-long workshop would be the balance between conditional and non-conditional grant, as well as the possible role of performance based grants.
