The government has disbursed nearly Sh110 billion to the counties, ending a crippling cash crunch that had crippled operations in most county governments, with most of the assemblies threatening to shut down operations.
President Dr William Ruto said the delay was occasioned by a change in strategy involving a shift from borrowing, seen in previous regimes, to finance the counties.
“The governors have accused the national government of paralyzing operations in counties through late disbursements, what we are not going to do is to borrow money to fund the devolved units, its easier to delay for a month or two than borrow,” said President William Ruto.
“This week I have cleared all the money we owed the counties, In the last financial year government was not able to clear counties arrears carrying forward the arrears to next financial year, nothing like that will happen this year,” he noted calling on the governors to continue with implementation of various projects.
County Governments received a total of Sh370.0 billion in Financial Year 2022/23 as equitable share of revenue raised nationally.
In addition to their proposed equitable share of revenue, County Governments received additional conditional allocations from the National Governments’ equitable revenue share, conditional allocations amounting to Sh5.7 billion for leasing of medical equipment and construction of County headquarters, Equalization Fund to the marginalized areas amounting to Sh7.1 billion; and Sh31.4 billion from proceeds of external loans and grants.
In the just read 2023/24 budget, the county governments will receive Sh385.4 billion compared to the current’s Sh370 Billion following an increase of Sh15.4 billion in the equitable share.
With the disbursement of the remaining amount of money, counties will get a relief in among others clearing salary arrears for staff and paying pending bills that has remained a thorn in the flesh for the 47 devolved units for a long period of time.
The total outstanding pending bills by the county government as of March 31, 2023 stood at Sh159.7 billion.
The increase in pending bills is pushing businesses into defaults and in order to get the suppliers off the auctioneer’s noose, Treasury has reached out to the Cabinet recommending the establishment of an inter-ministerial committee to carry out a thorough analysis of the stock of all pending bills and advice on how the bills will be settled.
Counties Set to Receive Kes 42 billion as President Ruto Signs Grants Bill. – Kenyan Wallstreet
