Treasury clears arrears for counties in FY 2023-2024

National Treasury Cabinet Secretary John Mbadi confirmed that there are no outstanding arrears owed to devolved units for the last financial year 2023-2024.

Speaking before Senators on Tuesday, Mbadi added that the government successfully cleared all arrears, amounting to Sh30.8 billion by July 2024, and also disbursed Sh3.5 trillion to all 47 counties for the last 11 years.

The Treasury noted that disbursements to county governments have consistently exceeded the constitutional requirement of 15 per cent of the last audited and approved accounts by Parliament.

"Except for 2019-2020, 2021-2022, and 2023-2024, the equitable share of revenue has been fully disbursed in accordance with Article 219 of the Constitution," Mbadi's statement read.

Earlier, the CS had attributed legal and administrative challenges as the main reasons why counties experienced delays in the disbursement of funds at the start of the current financial year.

Mbadi reassured Senators that despite the setbacks, his office is committed to making regular and timely transfers to counties moving forward.

He acknowledged that the transfers should ideally be done by the fifth of every month but explained that various issues had caused delays.

"The problems we encountered at the beginning of this year were not primarily due to cash flow challenges. Actually, keeping county transfers pending doesn't benefit the Treasury, as we just end up with huge bills to settle all at once," Mbadi explained.

One of the main challenges, according to the Treasury boss, was a legal debate about whether funds could be disbursed without passing the County Allocation of Revenue Act (CARA) for FY 2024-2025.

He noted that there were two conflicting views on this issue.

Disbursement 

All the 47 counties in Kenya for the last 11 years have received Sh3.5 trillion from the National Treasury.

As highlighted by the National Treasury, over the last decade, the annual disbursement to all counties increased by Sh186.13 billion, marking a significant growth of 95.13 per cent.

Nairobi County received the highest allocation, totalling Sh173 billion, benefiting its population of 4,397,073. This equates to an average of Sh3,581 per resident annually.

Following Nairobi, Turkana County received Sh123 billion for its population of 923,976, while Kakamega County obtained Sh120.6 billion for its 1,868,579 residents.

Kiambu County was awarded Sh113.9 billion, benefiting its 2,417,735 residents with an annual average of Sh4,283 per capita.

Kilifi County, with a population of 1,453,787, received a total of Sh113 billion. Mandera County followed closely with Sh111 billion over the same period.

The figures also highlight the government's commitment to supporting marginalised counties through the equalisation fund, aimed at promoting equity.

Bungoma County completed the list of counties that received over Sh100 billion, with a total of Sh102.3 billion since 2013.

Other notable counties exceeding Sh90 billion in disbursements include Wajir (Sh94.1 billion), Meru (Sh93.7 billion), Machakos (Sh93.3 billion), and Kisii (Sh92.7 billion).