Governors seek Senate support amid Sh20bn funding crisis

Governors are appealing to senators for assistance as they grapple with a significant cash crisis resulting from delayed disbursements.

This follows the ongoing discussion on the legislation to anchor fresh disbursements to the counties.

The Council of Governors (CoG) is particularly concerned about proposed legislation that could further strain county resources.

The National Assembly has suggested reducing counties' equitable share from Sh400 billion to Sh380 billion.

This proposal, if approved, would exacerbate the financial challenges faced by local governments and impact their operations this fiscal year.

The CoG has firmly rejected this reduction, arguing that it undermines their ongoing efforts to align with the aspirations of their constituents.

Fernandes Barasa, the CoG Finance Committee Chairman and Kakamega Governor has reached out to senators, urging them to stand firm during the mediation process for the 2024 Division of Revenue Bill.

"Let our senators remain firm and advocate for counties to receive Sh400 billion, not the Sh380 billion proposed by the National Assembly," Barasa stated.

Kakamega Governor Fernandes Barasa in at Cheptuli Village in Shivanga Ward, Malava Sub-County in Kakamega on October 16, 2024. (Photo: Handout)

He highlighted the potential disruptions to critical services if the allocation were to drop from the Sh400.117 billion originally earmarked under the 2024 Division of Revenue Allocation.

Revised downwards

Last year, counties received Sh385.4 billion, which was deemed insufficient considering the Senate's initial proposal of Sh415.9 billion before it was revised downwards during mediation.

The Kakamega county boss stressed that the country's budgeting system is currently incremental, meaning counties should not receive less funding than the previous year.

"The Constitution mandates that counties' equitable share be allocated stably and predictably, safeguarding it from revenue shortfalls," he stated.

Governor Bararsa also voiced the financial strain counties are experiencing as they struggle to complete essential development projects. Barasa urged Treasury Cabinet Secretary John Mbadi to expedite the release of funds for August, September, and October, emphasising that delays have adversely affected service delivery across devolved units.

The Commission on Revenue Allocation has echoed the CoG's concerns, warning that reduced allocations could jeopardise essential services.

The commission has called for the maintenance of Sh400.1 billion for this financial year, citing projected growth in ordinary revenue.

As the debate continues, the governors remain hopeful that the Senate will support their call for adequate funding, ensuring that counties can operate effectively and meet the needs of their residents.