Senate pokes holes in CRA autonomy

April 7, 2015 4:02 pm


CRA adjusted its proposed allocation to counties from 275 billion to Sh258 billion in consultation with the Executive/FILE
CRA adjusted its proposed allocation to counties from 275 billion to Sh258 billion in consultation with the Executive/FILE
NAIROBI, Kenya, Apr 7 – The Senate Finance and Economic Affairs committee has questioned the independence of the Commission for Revenue Allocation after it learned that it adjusted its proposed allocation to counties from 275 billion to Sh258 billion in consultation with the Executive.

CRA director Lineth Oyugi who appeared before the committee to give the commission’s recommendation on the Division of Revenue Bill said the reduction was made after some of the allocations were fixed as conditional grants by the National Government and thus had to be axed but Senators accused the commission of being arm-twisted by the Executive to adopt its proposals.

“As a commission we have reviewed our position and CRA recommends to this committee that Sh258 billion be the amount allocated to the county governments,” said Oyugi.

“Resource allocation is a negotiated process and that is the far we have been able to negotiate, if the senate can help us further and get additional resources we will happy.”

The Senate seemed to have received backing from the Council of Governors who called for the strengthening of the mandate of the commission to ensure it gives the final estimates of funds to be shared between the national government and the 47 county governments.

Wajir Governor Ahmed Abdulahi Mohammed, who is also the Council’s Finance and Economic Affairs Committee chairman, said this will end the recurrent disagreement over the Division of Revenue Bill.

“Based on the past history, because we have been in this game for the better part of the last two fiscal years, we know that somehow, the Treasury’s position is closer to the reality and as a Council we wanted this to be less acrimonious that we have seen in the past. I think it will be intellectually honest for me to state that we agreed to the Sh. 258 billion whilst understanding that the final decision sits with Parliament,” said Abdulahi.

He was responding to Senators Boni Khalwale (Kakamega), Mutula Kilonzo Junior (Makueni) and Ben Njoroge (Nominated) questioned why the governors had adopted the Sh258 billion figure proposed by the IBEC instead of the Sh275 billion that had been gazetted by the CRA.

CRA was also questioned over why it was allocating money to counties for leasing of medical equipment yet there was a Sh38 billion shillings deal between the National government, the governors and the Ministry of Health on the same.

The commission argued that it was initially opposed to the deal to have the National Government lease equipment on behalf of the County Governments and hence the proposal to have Sh.4.5 billion given to counties to lease their own equipment but the Sh.38 billion deal was signed behind their back.

“Later, the National government through the Ministry of Health came up with additional budget of Sh38 billion for leasing of the medical equipment. Chairman I am not able to link the two but what I know is Sh38 billion is being spent by the National government on behalf of the County government but the Sh4.5 billion will go direct to the counties,” stated Oyugi.

Khalwale said the Opposition intended to pitch on the medical equipment scheme and oppose it stating that if counties were allowed to get the equipment on their own Sh21 billion would be saved in a span of seven years.

“We need to invite the National Treasury and the Ministry of Health to come and tell us who is pocketing the Sh21 billion,” said Khalwale.

Just as the meeting with the Commission for Revenue Allocation was coming to an end, Treasury Principal Secretary Kamau Thugge walked in time to respond to questions by Khalwale and Kilonzo Jnr.

He however could not divulge all the details of the meeting saying the Ministry of Health was seized of the matter and were better placed to respond to it.

He however said the medical healthcare deal involving leasing was much more effective as the country would save money on repairs and in case a machine malfunctioned the providers would replace them.

“You can but in one year and one or two years down the line, the machine malfunctions and you may need to buy another one, but with leasing the cost of maintenance and replacement will be on the provider,” said Thugge.

“I assume there are going to be negotiations between the contractors and the Ministry of Health as to how much they will actually pay, but in the budget we have to put something, their preliminary estimate is Sh4.5 billion but ultimately it may be less than that.”

Then the Ministry of Devolution came under fire after Kakamega Senator Khalwale accused it of taking away public funds when it emerged that the National Youth Service was allocated Sh6.3 billion to perform its functions which were already devolved to counties.

CRA acknowledged that instead of the money going to the Ministry, it should be sent to the counties so that if NYS engage in any activities they are paid by the counties, a notion dismissed by the Treasury PS.

“We do not see any reason why this money should go to the counties, it is actually National Government money being used to train NYS,” said Thugge.

“We recommended that the NYS were doing functions that were county functions, what we noted is that it is possible that the NYS has a huge allocation, and they can spend all that money in one region, so if each county had its own allocation there would be some fair share of equity, ”said Oyugi.

Khalwale in his usual element claimed that this was “another corruption scandal in the offing adding that CRA had accepted to be used in a wrong way.”

The committee has since retreated to prepare a report to be tabled before the Senate during its special sitting this Thursday ahead of the April 10 constitutional deadline.


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