Governors across Kenya have raised alarm over the persistent delays in the disbursement of funds owed to counties, warning of a complete shutdown of county services if the situation is not addressed by the end of November 2024. The Council of Governors (CoG) is demanding immediate action from the National Treasury and the Senate to resolve the issue that has plagued the counties for months.
In a statement issued on Monday, the chairperson of the Council of Governors, Ahmed Abdullahi, stated that counties had not received their equitable share of revenue for the 2024-25 financial year, despite the passage of the County Allocation of Revenue Bill by both Houses of Parliament. The governors expressed frustration over the National Treasury’s failure to release the funds, even as it continues to benefit from its share of the national budget.
“We therefore call upon the Senate to expeditiously pass the County Allocation of Revenue Act to resolve this delay. Additionally, we demand that the National Treasury immediately releases the funds owed to counties, failure to which, county governments will have no choice but to shut down operations completely,” Abdullahi stated.
This warning comes after more than five months into the current financial year, with counties yet to receive the full amount of revenue allocated to them. According to Abdullahi, the delay has left many counties struggling to maintain essential services such as healthcare, education, and infrastructure development. The County Allocation of Revenue Bill, which determines how the revenue is divided between the national government and the counties, has already been approved, but its assent into law remains pending.
As a temporary measure, counties have been relying on a 50 percent share of revenue from the national government. This emergency fund was intended to tide counties over until the full allocation is released. However, Abdullahi pointed out that this is not a sustainable solution. “The 50 percent will be exhausted by December 2024, which means counties will not receive any disbursement from January 2025,” he said.
This dire situation has prompted the governors to take action, holding an Extraordinary meeting to deliberate on the matter. During the meeting, the governors also expressed their frustration with the delays caused by the Controller of Budget, whose approval is needed for the withdrawal of the 50 percent funds. Abdullahi called on the Controller of Budget to speed up the process, noting that the delay in approvals was exacerbating the financial strain on county governments.
“This is unacceptable to an institution that is supposed to be facilitative. We call upon the Controller of Budget to stop being a bottleneck to this process and ensure counties access their funds in a timely manner,” he added.
On the other hand, the National Treasury has defended its record, stating that over Sh158 billion has been disbursed to counties since June 2024. The Treasury released a detailed breakdown of the funds, indicating that the first disbursement of Sh30.83 billion occurred on July 26 for June 2024 allocations. Subsequent payments of Sh32.76 billion for July, Sh30.83 billion for August, and Sh32.76 billion for September were made in September, October, and November, respectively. Another payment of Sh30.83 billion for October is currently being processed.
Despite these figures, governors have raised concerns over the perceived inadequacy of the funds, arguing that the delays are causing significant operational challenges. Counties, which are tasked with delivering essential services to millions of Kenyans, are increasingly finding themselves in financial distress as they await the full release of their revenue share.
The standoff between the governors and the National Treasury highlights a broader issue of resource allocation and financial management within Kenya’s devolved system of government. The delay in disbursements not only jeopardizes service delivery at the county level but also raises questions about the adequacy of mechanisms in place to ensure timely and efficient financial transfers between the national government and counties.
With the governors warning of a potential shutdown in just weeks, it is clear that unless a resolution is reached, Kenya’s devolved governments may face a crisis that could impact millions of citizens. The ball now lies in the hands of the Senate and the National Treasury to resolve the impasse and ensure that county governments are able to continue their vital operations without interruption.
