The High Court has ordered National Treasury and Controller of Budget to release funds to 35 counties which are yet to receive their equitable share.
The National Treasury had withheld the devolved units' allocation due to pending bills.
High Court Judge Weldon Korir on Friday also directed the two institutions to adhere to the disbursements of funds by 15th of every month in accordance with the Constitution.
Seventeen counties are yet to receive their revenue allocation after being blacklisted by the Treasury over their pending bills.
On Wednesday the National Treasury, through CS Ukur Yatani, released Sh11 billion to 18 counties after they promised to settle the pending bills. Another Sh7 billion was released to 12 counties that had settled their pending bills.
“Further to the National Treasury circulars and engagement with county governments in regard to payments of pending bills, I wish to inform the public and other stakeholders that we have released Sh11 billion to 18 counties who have presented a clear and acceptable plans for settlement of validated pending bills. In addition, we have also released a total of Sh7 billion to 12 counties who had fully paid their pending bills,” read the circular to counties.
But the Council of Governors has accused the Treasury of exercising powers it does not have.
In the petition, the governors cite the National Treasury, Controller of Budget and the Attorney General as respondents. The governors argue that by withholding funds to the counties, the respondents have contravened the Article 219 of the Constitution that directs them to release the funds not later than 15th of the every month.
“According to article 219 of the Constitution as read with section 17 (6) of the public management Act, the first and the second respondents are bound to release the equitable share in a timely manner and in any event not later than 15th of every month.
“We are also seeking a declaration that in any event of serious or persistent material breach, the first respondent may not stop the transfer of more than fifty per cent of the funds due to a county government in line with article 225 (4) of the Constitution,” read the petition.
The petition argues that withholding of funds to counties was irregular since it had not been approved by Parliament as required by law and that there was no substantive controller of budget whose report was paramount in the decision to approve the stoppage of funds process.
They claim that the role of the National Treasury is to set policies and not to manage the devolved functions.
“The role of the first respondent is to set policies and standards and not to manage the devolved unit, the move by the National Treasury is in total disregard to the law,” the petition reads.
Some governors accused CS Yattani of not giving them audience. The full hearing of the petition has been set for January 28, 2019.