Budget likely to be held back as Houses adjourn over virus

Preparing the national budget could be delayed after Parliament adjourned last week as part of efforts to check the spread of the new coronavirus.

With over 11,000 deaths reported across the world by yesterday morning, and over 270,000 confirmed cases, the pandemic has triggered an international crisis that threatens to cripple the world economy.

On Tuesday, legislators from both Houses voted to alter their calendars. While the National Assembly plans to resume its sittings on April 30, depending on the situation then, the Senate voted to hold a sitting on March 31 and thereafter have weekly sittings until the situation improves.

This being a critical time in the budget-making cycle, the process is likely to remain in abeyance should the pandemic worsen and prompt a prolonged absence of lawmakers.

This is because key budget milestones are constitutionally time-bound.

At the time of adjournment, the two Houses had debated and adopted the 2020 Budget Policy Statement (BPS). The document sets out the broad strategic priorities and policy goals that guide the national and county governments in preparing their budgets.

The BPS was tabled in the two Houses on February 15 alongside the 2021 Division of Revenue Bill, the County Allocation Revenue Bill and the Debt Management Strategy Paper in line with the requirements of the law.

While the Division of Revenue Bill outlines how to share revenues between the two levels of government, the County Allocation of Revenue Bill divides up equitable shareable revenue, which is a minimum of 15 per cent of the last audited accounts approved by Parliament.

The Public Finance Management Act mandates Parliament to consider and approve the bills not more than 30 days after their introduction in either House.

The passage of the bills allows counties to start preparing their budgets. Therefore, any delay in passing the two laws means counties will also delay preparing their budgets, which may affect services.

The total shareable revenue for the 2020/21 financial year is Sh1.856 trillion. It is proposed that the national government retain Sh1.53 trillion while counties take Sh369.8 billion in equitable shareable revenue.

Of this, Sh316.5 billion is the equitable share of revenue, Sh13.7 billion is conditional grants from the national government share of revenue, Sh30.2 billion conditional allocations from loans and grants by development partners and Sh9.4 billion conditional allocation from the Roads Maintenance Levy.

Senate Speaker Kenneth Lusaka, defending the decision to adjourn, called for calm, assuring counties that there is room for the House to hold special sittings to consider matters that are critical to the running of the State.

“Our motion of adjournment had a provision that the Senate reserves the right for a special sitting,” Mr Lusaka told the Sunday Nation.

Senate Minority Leader James Orengo called on lawmakers to be ready at any moment to be recalled.

“Parliament should be recalled any time, especially during a time when there is an emergency. In the context of our Constitution, Parliament has a role throughout even if it is wartime,” he said, arguing that outstanding laws could be enacted to forestall financial crises in counties.

Bungoma County Senator Moses Wetang’ula who was opposed to the adjournment, challenged the Speaker to give direction on what should happen with constitutional timeliness of the budget making process.

“This is the budget season and some of the issues that we deal with in budgeting are constitutionally time bound with set timelines. If we go on recess, do we have the capacity to expand the constitutional timelines?”

The enactment of the bills also faces the hurdle of public participation, which could prove tricky in light of government directive on social distancing.

The National Treasury is supposed to submit to the National Assembly the 2020/21 financial estimates by April 30.