NAIROBI, Kenya, Jun 10- Devolution has received a major boost after the National Treasury increased the resources located to County Governments by Sh56.6 billion.
Treasury Cabinet Secretary Ukur Yatani said Sh370 billion has been allocated to County Governments, an equitable share representing 27.3 percent of the most recent audited and approved revenue raised nationally.
In his budget speech in the National Assembly Thursday, Yattani said the County Governments will receive Sh7.5 billion as conditional allocations from the National Government share.
With this, Yattani said the total funds allocated to the County Governments will amount to Sh409.9 billion, an increase from Sh353.3 billion allocation in the previous financial year.
Yattani was speaking in the National Assembly where he read out the Sh3.4 trillion budget estimates for the financial year 2021-22.
“In line with the High Court ruling on Petition No. 252 of 2016 directing that conditional and unconditional grants to County Governments should not be provided for under the Division of Revenue Act, the National Treasury in consultation with other stakeholders in developing an appropriate legal instrument to be used to disburse additional conditional grants from the National Government’s share of revenue as well as from proceeds of loans and grants to County Governments,” the CS said.
And to support the Nairobi Metropolitan Services, Yattani proposed to allocate Sh27.2 billion which will comprise Sh18 billion for recurrent expenditure and Sh9.2 billion for development expenditure.
“To support County Governments capacities to enhance their own source revenue and reduce over-reliance on the equitable share, the National Treasury rolled out a nation-wide capacity building exercise for the County Governments on interventions contained in the National Policy to Support Enhancement of County Governments’ Own-Source Revenue,” he said.
Yatani said the policy proposes expanding the revenue base while enhancing counties’ revenue administrative capacities.
The policy further proposes a legal framework to ensure that County Governments comply with Article 209(5) of the Constitution of Kenya when formulating their revenue-raising measures.
“In this regard, we re-submitted the County Governments (Revenue Raising Process) Bill, 2020 to this August House in early 2020 for consideration. It is my hope that this bill will get necessary priority and approval,” he said.
He also pointed out that the Government through a multi-agency task force has reviewed existing revenue management systems with a view to deploying one Integrated County Revenue Management System for use by all the 47 County Governments.
The task force, he said, has since completed its work and made appropriate recommendations for consideration by the two levels of Government.
“In order to provide basic services to previously marginalized areas as envisaged under the Constitution of Kenya, the concerned County Governments have been allocated Sh6.8 billion under the Equalization Fund in the financial year 2021/22,” he said.
