The Council of Governors (CoG) has criticised MPs for rejecting the Senate's proposal to increase equitable shareable revenue to counties for the financial year 2024/2025 from Sh385 billion to Sh415 billion, terming it a threat to devolution.
CoG Finance and Economic Planning Committee chairperson and Kakamega Governor Fernandes Barasa said devolved units require more funds to implement projects.
Governors had demanded Sh450 billion for the coming financial year.
“I find fault with the National Assembly Budget Committee for rejecting senators’ proposal to increase counties allocation to Sh415 billion. Counties have medical equipment to be serviced and various other duties which have been devolved but not funded,” said Barasa.
The governor was speaking during an inspection of maize farmers’ output in Etenje ward, Mumias West constituency, Kholera ward in Matungu constituency, and Marama central, Butere constituency among others.
He questioned the rationale behind the bid’s rejection saying that for devolution to be successful counties should be well-funded
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“The proposed allocation of Sh391 billion by the National Assembly is not enough for counties to implement projects and effective service delivery to the people and the move by the National Assembly Budget Committee is a clawback to devolution," he said.
On May 13, 2024, members of the National Assembly on Monday unanimously voted to reject amendments to the Division of Revenue Bill 2024 as proposed by the Senate which aimed to increase allocation to counties to Sh415 billion while it had recommended Sh391 billion.
MPs argued that increasing county funds would mean a reduction to the National Government Constituency Development Fund (NG-CDF) and the National Government Affirmative Action Fund (NGAAF).
Kiharu MP Ndindi Nyoro who chairs the Budget Committee said the country was working with a budget of about Sh4.1 Trillion each year which had been reduced to Sh3.8 trillion and that they had set a ceiling of Sh391 billion for counties making the proposal to increase it to Sh415 billion by the Senate untenable.
“This House passed the same Division of Revenue Bill and when it proceeded to the Senate which could have agreed with it as it was it could have proceeded to the next level, we have to go for a mediation with the Senate so that we can have a middle ground for this matter,” said Nyoro.
A month ago the Commission on Revenue Authority (CRA) proposed Sh413 billion as equitable shareable revenue to counties for the fiscal year 2024/2025.
CRA Commissioner Hadija Nganyi who spoke in Kakamega said governors should expect an additional Sh22 billion on top of Sh391 billion disbursed by the National Treasury.
“As a commission, I want to assure governors that we have listened to their grievances, they are proposing Sh450 billion as an equitable share up from Sh391 billion citing an increase in National Security Social Fund, Social Health Insurance Fund and Housing Levy contributions,” said Nganyi.