Counties secure Sh387 billion as mediation ends funding stalemate
By Lucy Mumbi |
The committee reinstated last year's allocation of Sh385 billion and added Sh2 billion to reach the agreed amount.
Counties are set to receive Sh387 billion for the 2024/2025 financial year following a resolution by the mediation committee of the National Assembly and the Senate on the Division of Revenue Bill, 2024.
The Mediation Committee, co-chaired by Kiharu MP Ndindi Nyoro and Mandera Senator Ali Roba, increased the allocation by Sh2 billion compared to the previous financial year, citing challenging economic conditions.
Keep reading
“We are facing reality as it is without sugarcoating. As much as we are willing to allocate counties more funds, there is scarcity due to revenue shortfalls,” the committee said.
The committee reinstated last year's allocation of Sh385 billion and added Sh2 billion to reach the agreed amount.
"Out of our deliberation, the hard negotiations, and zooming in on data, we have reinstated the last financial year allocation at Sh385 billion and added Sh2 billion to make it Sh387 billion,” Nyoro said.
Initially, the National Assembly had passed the Division of Revenue Bill 2024, endorsing a revenue share of Sh380 billion, aligning with the National Treasury's proposal after the withdrawal of the Finance Bill 2024.
However, the Senate insisted on a Sh400 billion allocation, arguing that counties could not function effectively with the lower amount.
The deadlock led to the formation of the joint mediation committee, which ultimately brokered the agreement.
The Treasury had dismissed calls for an additional Sh20 billion for counties, urging governors to accept the Sh380 billion proposed by the National Assembly.
Cabinet Secretary John Mbadi argued that while the demand for increased funds is legitimate, the country's struggling economy cannot sustain the Sh400 billion sought by senators and county governments.
"Governors should just accept Sh380 billion this financial year as we work out ways to increase the allocation next year," Mbadi said.
He emphasised the need for financial prudence, adding, "I would love to give counties more money, but our economy simply cannot support it for now."
He cautioned against committing to unrealistic allocations, which could lead to arrears and disrupt county operations.
Reader comments
Follow Us and Stay Connected!
We'd love for you to join our community and stay updated with our latest stories and updates. Follow us on our social media channels and be part of the conversation!
Let's stay connected and keep the dialogue going!
Latest News For You
