Revenue agency limits counties' expenditure

Friday May 10 2019

Commission on Revenue Allocation

Commission on Revenue Allocation (CRA) Chairperson Jane Kiringai delivers her remarks during the Gross County Product report launch at KICC on February 13, 2019. The CRA has amended the annual recurrent expenditure for counties. PHOTO | FILE | NATION MEDIA GROUP 

KENNEDY KIMANTHI
By KENNEDY KIMANTHI
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The Commission on Revenue Allocation (CRA) has capped counties’ annual recurrent expenditure at Sh60 billion in the 2019/20 Financial Year.

In the budget ceiling proposal presented to the Parliamentary Budget Office, CRA has barred county assemblies and the executive from exceeding the recurrent expenditure of Sh33.2 billion and Sh27 billion respectively.

Recurrent expenditure comprises lists of expenses that go into the running of the counties, such as salaries and allowances, operational costs which include travelling and accommodation, telephone, electricity and water bills, and maintenance costs incurred on equipment, buildings and installations.

The expenditure also includes funding for costs incurred to cover compulsory obligations such as bank charges, interest on debts, remuneration costs and other services.

The Sh60 billion is an increase from Sh59.5 billion that the commission capped for counties this financial year (2018/19).

ALLOCATION

In arriving at the amount, CRA considered a court ruling which quashed Gazette Notice No.6518 of July 2017 which affected salaries and other benefits to senior county officials: governors, their deputies, ward representatives and county executives.

Input from the Controller of Budget, Salaries and Remuneration Commission, Council of Governors and Ethics and Anti-Corruption Commission was also captured.

In the document seen by the Nation, the county with the largest proposed ceiling on executives is Nairobi at Sh759 million.

Others are Kakamega and Kiambu (Sh673 million), Nakuru (Sh656 million), Bungoma, Kisii and Meru at Sh621 million, Homa Bay, Kitui and Machakos at Sh604 million.

DEVELOPMENT

County assemblies to be affected by the highest ceilings are Nairobi (Sh1.4 billion), Kakamega and Kiambu (Sh1 billion), Nakuru (Sh983 million), Kisii (Sh919 million) and Meru (Sh914 million).

The Public Finance Act caps county governments spending on compensation of employees at 35 per cent of revenues.

In March, President Uhuru Kenyatta announced plans to hold a national forum to discuss public expenditure. More than 50 per cent of revenue goes into salaries of civil servants, 30 per cent to recurrent expenditure and only 20 per cent to development.