NAIROBI, Kenya, Jun 29 – The Council of Governors wants the national government to pay interest to each county which has been affected by late disbursement of funds.
The council’s Finance, Commerce and Economic Affairs Chairman Wycliffe Oparanya indicated that the government has failed to live up to its agreement with County governments and stated that the interest rate should be pegged at market rates.
The Kakamega Governor was speaking during a press briefing where he maintained that county governments have not yet received their May and June disbursements from the Exchequer.
“Once again, the council would want to reiterate to Kenyans that county governments have not received their May and June disbursements from the National Exchequer. The financial year closes tomorrow 30th. Even if counties receive monies today, the money can only be used in the next financial year meaning the resources will have to be re-budgeted for,” he stated.
“If this happens, it will mean that counties need to request the Controller of Budget for its withdrawal into relevant operational accounts. This may take up to four working days hence it is not possible that the monies released would be used to implement any pending activity in the current financial year.”
He described the National Treasury as insincere and stated that it was out to frustrate the county governments’ development agenda.
“As far as the Council of Governors is concerned, there have been tremendous delays in the release of county cash into the county revenue accounts. This is evident and the National Treasury confirmed it through their advert by indicating that as at 16th June 2015, 86 percent of disbursements due to counties 2014/2015 had been released,’ he stated.
He stated that all disbursements should have been paid in full as had been agreed previously.
“It is June 29th 2015, one day to the end of the current financial year. Why should we be talking about 86 percent disbursements and not 100 percent? We should be talking about 100 percent disbursements which should have been made by the 15th date of the month as per the disbursement schedule or better 15th April as per the PFM Act section 17 (6),” he said.
Oparanya further contended that there is no provision in the law that gives the National Treasury any powers to disburse monies to the counties under this criterion.
“This is an outright breach of the Constitution. The Council of Governors wishes to tell Kenyans that cash balances in the county accounts at the Central Bank include the locally raised revenues by individual counties and the national transfers by the National Treasury. The National Treasury should have been honest with Kenyans by separating these two types of revenues and instead provided the cash balances arising from the National transfers only as a percentage of the exchequer releases,” he stressed.
The National Treasury on Sunday refuted claims made by the Council of Governors that it is out to kill devolution following delay in releasing the funds.
Principal Secretary Kamau Thugge had stated that they had so far released 86 percent of the county funds which is equivalent to Sh196.9 billion out of Sh229billion for the current financial year of 2014/2015.
Oparanya however stated that no fund have ever been disbursed to the county governments as provided for in the disbursement schedule.
“The cash disbursement schedule approved by the Senate in September 2014 provided disbursement to county governments by the National Treasury on a monthly basis and not later that the 15th day from the commencement of the month. This provision in itself is in contrast with what the PFM Act stipulates as per section 17(6),” he indicated.
He pointed out that the Act provided that the National Treasury shall at the beginning of every quarter and in any event not later that the fifteenth day from the commencement of the quarter, disburse monies to count governments.
He claimed that many county workers are yet to get their salaries for lack of these funds.
“This is to tell Kenyans that cash balances in the counties accounts do not represent idle money as being portrayed by the National Treasury. Part of these monies is what county governments use to pay for salaries and incur other administrative costs when national disbursements are not received on time as has consistently been the case,” he said.
“The Kenyan public needs to know that county governments have and will continue to prioritize on their development agenda to ensure effective and efficient service delivery to the people of Kenya. No employee will be subjected to salary delays of any month worked for. Together we shall move Kenya forward.”