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Senators approve Sh335bn as MPs table another bill for less

Wednesday July 24 2019

Governors and senators at top court

Governors, deputy governors and senators at the Supreme Court, where they filed a petition on the division of revenue bill on July 15, 2019. PHOTO | EVANS HABIL | NATION MEDIA GROUP 

IBRAHIM ORUKO
By IBRAHIM ORUKO
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DAVID MWERE
By DAVID MWERE
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The circus surrounding the Division of Revenue Bill 2019 continued Tuesday with the Senate debating and passing its own version in a record 40 minutes. It settled on Sh335 billion as the equitable shareable revenue for counties in the 2019/20 financial year.

COLLAPSED

However, even as the Senate passed the bill, the National Assembly was not left behind as a similar bill was introduced, with a proposal to allocate Sh316 billion as funds for counties.

The National Assembly Bill was introduced by the chairman of the Budget and Appropriations Committee, Mr Kimani Ichung’wa, after Speaker Justin Muturi slammed the 2013 Supreme Court advisory on the role of the Senate in enactment of the bill.

Mr Muturi argued that the advisory, which declared that the Division Bill is an ordinary bill and that the Senate has a role in its debate, was dangerous and was akin to killing devolution.

The initial bill, which was drafted by the National Treasury, did not sail through after the two Houses failed to agree on the amount of funds due to counties. The National Treasury allocated Sh310 billion, down from Sh314 billion that counties received in the 2018/19 fiscal year.

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However, while the National Assembly supported the reduced figure, the Senate rejected the Sh310 billion because it was a reduction from the previous year’s amount and it was contrary to the Commission of Revenue Allocation’s (CRA) recommendation of Sh335 billion.

The mediation committee that was formed by the two Speakers failed to agree and the bill collapsed.

While moving the bill in the Senate, chairman of the Budget and Finance committee Mohamad Muhamud said the House had decided to republish the bill on the basis of the CRA position.

Mr Muhamud faulted the decision by the National Treasury to reduce the base for equitable share, terming the move as illegal since both the Division of Revenue Act, 2018, and the County Allocation of Revenue Act, 2018, were not amended to take care of the revised figure.

INFLATIONARY

“Revision of the equitable share base is illegal because neither the Senate nor the National Assembly was amended,” Mr Muhamud told the House.

In the National Assembly, Mr Muturi curtailed debate on the matter as it is in court after Mr Ichung’wa reintroduced the bill that was then committed to the Budget and Appropriations Committee that he chairs.

While the National Assembly has stuck on the Sh316, the Senate has stuck on Sh335 billion arguing that the figure takes care of inflationary conditions for counties.

The Sh335 was arrived at using the Sh314 billion, which is in DORA 2018 and CARA 2018 as the base and then factoring in a 3-year inflation rate at the current 6.9 per cent

However, Mr Mahamud faulted the National Treasury for revising the figure of funds to counties and urged the National Assembly to defend the constitution by ensuring that more funds are disbursed to counties.

“The National Assembly must be pragmatic and not defend like a National Treasury that has gone rogue,” he said.

Bungoma senator said Sh335 billion is not enough for the counties but Senate had given in because it was the recommendation of CRA.

“We are not here to defend counties on the basis of tokenism of the National Assembly. We are supposed to be just and fair to all and defend the law,” Mr Wetangula said, while challenging the National Assembly to explain the basis of its Sh316 billion.

“We run on the basis of institutions whose decisions we must respect.”

DEVIATE

The Bill was introduced in the House on Thursday last week with the Senate adopting a procedural motion that shortened its publication period from 14 days to one day.

On Tuesday, the Bill went through the second and third readings in a record 40 minutes, with a total 29 delegations voting to adopt the Bill at the committee of the whole.

But the absence of the Act has made it difficult for the counties to proceed with their budgeting process in a move that could ground their operations because of the cash crunch.

“It is that advisory that has taken us to where we are now- that division of revenue be considered by the two houses and some people going out there to say that the National Assembly is killing devolution,” he said.

Mr Muturi was clear that whoever receives the CRA recommendation is mandated to deviate given the circumstances of the whole economic prevailing situation.

“The CRA recommendations are not binding to the National Treasury.”

However, Mr Muturi curtailed debate on the matter as it is actively in court after Kikuyu MP Kimani Ichung’wah reintroduced the bill that was then committed to the House Committee on Budget and Appropriations (BAC) that he chairs.

“The only eligible bill has been published by the National Assembly. The budget committee will subject it to public participation and we will table a report to be considered by this House,” Mr Kimani said adding that DoRB is a money bill whose point of origination should be the National Assembly.