Allocation of county cash row moves to court

The row between the Senate and the National Assembly over money to be allocated to counties is expected to move to court on Thursday as the devolved units continue to suffer over delayed funds.

The Senate is expected to challenge at least 20 pieces of laws that have been passed and enacted without its input.

The senators want the court to determine that any Bill passed by the National Assembly and assented to by the President without reference to the Senate does not meet constitutional threshold and that they should declared null and void.

The senators further argue that they will not endorse the Division of Revenue Bill until the figure is raised to Sh327 billion.

DIVISION OF REVENUE

Last week an informal meeting bringing together governors, Controller of Budget, Commission on Revenue Allocation (CRA) and Parliament, and which was chaired by Deputy President William Ruto resolved that the issue of the Bill must be resolved by Thursday last week.

The meeting ordered Parliament and the National Treasury to speedily resolve the revenue allocation stalemate over funds meant to be shared among counties in the next current financial year that began on July 1.

In the Division of Revenue Bill, 2019, the National Treasury had proposed Sh310 billion as the equitable share to the counties for the 2019/2020 financial year.

The figure is a reduction from Sh314 billion that counties received in previous financial year.

Treasury has argued that the reduction was on account of underperformance of revenue that resulted in a downward adjustment of the forecasted revenue for the 2018/19 financial year by Sh117.7 billion from Sh1.8 trillion to Sh1.6 trillion.

REVISED FIGURE
However, the Senate objected to this revision arguing that the revised figure contradicts an estimated favourable growth of 6.1 per cent for the 2018/19 financial year.

Further the senate argues that the revised estimated is not based on any law since it was not approved by Parliament and that it contravenes section 5 (1) of Division of Revenue Act, 2018, in which any shortfall in expected revenue is to be borne out by the national government.

CRA had proposed county equitable allocation of Sh335.7 billion for the 2019/20 financial year.

The recommendation was based on adjusting the 2018/19 allocation of Sh314 billion (which was the base) by an actual three-year average of annual inflation factor of 6.9 percent.

It is on this basis that the Senate amended the Division of Revenue of Bill, 2019 and increased the proposed equitable share from Sh310 billion to Sh335.7 billion as proposed by CRA.

However, the National Assembly rejected the amendment and when the matter went for mediation between the representatives of the two houses, the two sides couldn’t agree even though the National Assembly conceded to Sh6 billion extra while the Senate reduced its demand to Sh327 billion.