Body unveils county revenue allocation formula

February 28, 2012


Poverty and land area will be given a weight of 12 percent and six percent respectively/FILE
NAIROBI, Kenya, Feb 28- The Commission on Revenue Allocation has worked out a formula with which to distribute resources to all counties once the devolved system of governance is implemented.

According to Chairman Micah Cheserem, the proposed formula that is based on several indices including population, land size and poverty levels is designed to ensure the promotion of an equitable society.

“We have chosen five parameters (population, poverty, land area, basic equal share and fiscal discipline) in order to give effect to the constitution especially Article 203,” he said.

According to the formula which has been expressed mathematically, 60 percent of the money will be shared using the population criteria. Further, it will be assumed that all counties have the same basic expenses and as such will be allocated 20 percent of the revenues to cover such services.

Poverty and land area will be given a weight of 12 percent and six percent respectively.

In addition, there will be an incentive for counties to prudently manage their resources and hence the allocation of two percent for the fiscal discipline indicator.

The commission aimed to produce a simple and transparent criterion that can be understood by the average Kenyan. Data will be sourced from official government channels such as the Kenya National Bureau of Statistics, the commission revealed.

While unveiling the formula, the chairman pointed out that counties will share about 15 percent of the national revenue which the commission is recommending should be paid out quarterly.

Out of the national cake, 84.5 percent of the revenues will go to the central government which will also be expected to chip into the county development through for instance funding infrastructural projects, education and health.

The remaining 0.5 percent will be reserved for financing projects for and by marginalised group under the Equalisation Fund.

The public has the next 30 days to express their views on the formula after which it will be forwarded to Parliament for debate.

“Article 201 of the Constitution requires that there shall be openness, accountability and public participation in financial matters. It is in the light of that requirement that we request comment on the formula from all stakeholders,” he appealed while also inviting the youth and the Kenyan Diaspora to offer constructive suggestions.

This they can do through social media such as Twitter, Facebook or phone calls and Short Message Service to the commission.

But even as their input is awaited, Cheserem was quick to remind Kenyans that it was their responsibility to elect leaders with integrity and those who had their interest at heart.

Such leaders he said would be in charge of their county resources and ensure they are utilise them prudently. It is not the commission’s mandate to interfere with a county manages its resources, Cheserem reinforced.

“The job of electing the governors is in the hands of Kenyans. If you (the public) do not vet and bring in honest people, then they will steal your money. It is not our mandate to come and check on your money, so let every Kenyan choose honest leaders,” he challenged.

The commission reckons that there is still a lot of data that is unavailable for them to develop a conclusive formula and as such acknowledge that it will be subject to a review after three years of use.

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