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{
    "id": 385276,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/385276/?format=api",
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    "content": "levels within the county. Even with the county trying to think about how to really use the natural resources, there is the hiccup as they look back and see what it really entails. Therefore, there is a feeling from the counties that, at the end of the day, they should be able to gain from the natural resources within their counties which are God-given. Sometimes these natural resources are also seen as being part of a heritage for a particular county. They are holding it for the future generations. Therefore, even as they give that land to be used or even as they give their mines to be exploited, there is need to make sure that that county benefits from their natural resources. That will, in turn, also help to have faster rate of development depending on how the revenue that is allocated is going to be used at the county level. So, there is that feeling that there is un-proportional formula in terms of what a county ends up with and also the feeling that some counties do not produce as much as other counties. At the end of the day, they still have to be given as much. This means that we must propel counties to begin to think about the natural resources that they have and how to exploit them. We do not want a sort of a socialist notion where, at the end of the day, it does not matter what you bring into the pot, but you will get your fixed revenue. As an impetus, therefore, the idea is to come up with incentives that will help counties to think about how they can begin to exploit their natural resources to their advantage. The proposal is that at least 20 per cent of collected revenue from extraction of natural resources is ploughed back directly into the county. Certain systems, for example, in Indonesia, have about 15 per cent of oil extracts and 30 per cent of gas extracts being collected nationally. But when the division is done in terms of revenue, their proportional contribution is taken into consideration. Therefore, they end up getting more than others who did not contribute as much. That gives a feeling of direct contribution. Another proposal is to have that 20 per cent in royalties. Royalties are based on direct production rather than profits so as to ensure that a county is able to reap directly from its natural resources. If that is left on the investors to decide, we will have some investors who will come on the fore and say that they have made losses. Therefore, the county is not able to gain any revenue from what has been really extracted. But through legislation, we can make such legislation so that royalty is given directly to the county. The notion of the importance of a county and the notion of the importance of the community are enshrined again in Article 174(d) of the Constitution that recognizes the right of communities to manage their affairs, so that, in turn, can further their development. Article 174(f) is about promotion of social and economic development. This is expected to take place at the county level. Article 209(2) says that:- “(2) An Act of Parliament may authorise the national government to impose any other tax or duty, except a tax specified in clause (3) (a) or (b).” This refers to a tax or duty that is going to be directly beneficial to a particular county. Therefore, royalties, in that sense, will help to push the counties forward. What do the counties do then with this revenue that has been collected in the form of royalties for that particular county? Vision 2030 has made an analysis of the various counties and actually already set priorities for them. One county might want to say “my agenda is education,” another county’s agenda might be health while another county’s agenda might be infrastructure. The proposal is to have a revenue fund, but also have a The electronic version of the Senate Hansard Report is for information purposes only. A certified version of this Report can be obtained from the Hansard Editor, Senate."
}