Lavish spending in counties worries Controller of Budget
Controller of Budget Agnes Odhiambo. Development expenditure by county governments dropped between July 2017 and March this year, a recent report by her office shows PHOTO | FILE | NATION MEDIA GROUP
What you need to know:
Tharaka-Nithi, Meru and Embu recorded the highest percentage at 94.4, 92.5 and 86.5, respectively, of money spent on personnel emoluments.
County governments generated Sh9.95 billion, which was 18.1 percent of the annual target.
This was a decline of 25.7 percent compared to Sh13.4 billion generated in a similar period of 2016/17 financial year.
Out of every Sh1,000 that left Tharaka-Nithi County accounts in the first half of the 2017/18 Financial Year, Sh944 was used to pay salaries.
Similarly in Meru and Embu, out of each Sh1,000, Sh925 and Sh865 respectively, was paid to their workers.
Tharaka-Nithi, Meru and Embu recorded the highest percentage at 94.4, 92.5 and 86.5, respectively, of money spent on personnel emoluments.
They are three of 14 counties that did not spend any money on development during the reporting period.
WAGE BILL
The report flies in the face of Controller of Budget Agnes Odhiambo’s advice on prudent spending in the counties. The wage bill crisis is exacerbated by the runaway hiring in the devolved units as well as the benefits enjoyed by elected officials.
In her latest budget implementation review report, Ms Odhiambo cautions counties to ensure expenditure on personnel emoluments is contained within sustainable levels in compliance with the law.
Regulation 25 (1) (b) of the Public Finance Management (County Governments) Regulations, 2015 sets a limit of the County Government’s expenditure on wages and benefits at 35 per cent of the county’s total revenue.
Cumulatively, counties spent Sh66.48 billion on personnel emoluments, which accounted for 64 percent of the total expenditure.
HIGHEST EXPENDITURE
This was an increase of 6.9 per cent from Sh61.9 billion incurred in a similar period of the financial year 2016/17.
Mrs Odhiambo said Nairobi City County reported the highest expenditure on personnel emoluments at Sh6.63 billion, followed by Kakamega and Kiambu counties at Sh2.69 billion and Sh2.46 billion, respectively.
Other high spenders were Machakos (Sh2.2 billion), Nakuru (2.4 billion) and Mombasa (Sh1.8 billion).
This was happening even as revenue collection dropped. County governments generated Sh9.95 billion, which was 18.1 percent of the annual target. This was a decline of 25.7 percent compared to Sh13.4 billion generated in a similar period of 2016/17 financial year.
LOWEST REVENUE
Nairobi City County generated the highest amount of local revenue at Sh3.11 billion, followed by Narok and Nakuru at Sh1.21 billion and Sh685.99 million, respectively. Counties that generated the lowest amount of revenue were Mandera, Lamu and Tana-River at Sh20.6 million, Sh15.04 million and Sh7.9 million respectively.
The report notes that county governments spent Sh11.36 billion on development activities, representing an absorption rate of 8 per cent of the annual development budget. This is a decrease from 21.5 per cent, reported in a similar period of 2016/17.
Kilifi County recorded the highest expenditure on development activities in absolute terms at Sh1.65 billion, followed by Kiambu and Kakamega at Sh856.28 million and Sh844.69 million respectively.
RECURRENT ACTIVITIES
Nairobi City County attained the highest expenditure on recurrent activities at Sh9.98 billion, followed by Narok and Kiambu Counties at Sh3.4 billion and Sh3.34 billion respectively.
The lowest recurrent expenditure were recorded by Vihiga, Lamu, and Isiolo Counties at Sh868.66 million, Sh770.17 million and Sh943.64 million respectively.
Embu, Garissa, Kirinyaga, Kisumu, Meru, Nakuru, Nandi, Nyandarua and Nyeri, Siaya, Taita-Taveta, Tharaka-Nithi, Vihiga, and West Pokot did not incur any expenditure on development during the reporting period.
