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"id": 513175,
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"content": "of the Constitution which mandates them to make recommendations on financial management. The CRA found it necessary to set the ceilings for both arms of Government so that there would be a structured determination of how new administrative structures’ budgets in the counties can be shared out. This will eliminate, in their view, arbitrary allocation of funds between the assemblies and the executive and also ensure equitable utilization of resources. It was, therefore, according to the CRA, necessary to set the ceilings to minimize wastage of financial resources by both arms of Government. In a meeting of our Committee in March, we established that the proposed ceilings are appropriate in maintaining financial discipline in counties and recommended an amendment to the Public Finance Management Act (PFMA) through the County Allocation of Revenue Act, 2014, to give the proposed ceilings the force of law. Subsequently, that law was passed by this House. The Controller of Budget issued circulars addressed to the county governments demanding that the respective county assemblies’ budget allocation should comply with a formation circular issued by the CRA. In so doing, the Controller of Budget stressed that failure to comply with the ceilings advised by the CRA would result in withdrawal of county revenue funds being declined. Following the circular, some counties complied with the ceilings while others declined, expressing concern that they had already approved their respective Appropriations Acts. The Controller of Budget proceeded to decline requests of counties that did not comply with the ceilings. So, what did county assemblies do? The assemblies challenged the decision of the Controller of Budget in court through case No.368/2014 on the legality of the circular by CRA which sets the ceilings. A consent order between the three parties which is the CRA, the Controller of Budget and the county assemblies allowed withdrawal up to 50 per cent, based on the ceilings, was filed in the court on 25th July, allowing counties to implement their respective budgets as they awaited their final ruling. Again, a further consent was entered in court on 30th January this year, allowing counties to withdraw up to 75 per cent. The final ruling of the matter was delivered on 20th February by the court and provided as follows. A declaration that the circulars were null and void for all intents and purposes and should be quashed was not granted and was, instead, dismissed. Orders that the Controller of Budget should approve and disburse the assemblies’ funds as provided for in every county government’s budget estimates and as provided for in the Appropriations Acts of Counties was also not granted and was instead dismissed by the courts. The court also held that it was the duty of the Controller of Budget to oversee the implementation of the respective budgets. Mr. Speaker, Sir, as of 17th March, 30 counties had complied with the ceilings out of the 47 and are drawing their full budgetary provisions from the Exchequer. These include: Baringo, Bomet, Bungoma, Busia, Elgeyo-Marakwet, Garissa, Isiolo, Kakamega, Kiambu, Kirinyaga, Kisii, Kisumu, Laikipia, Mandera, Makueni, Migori, Meru, Muranga, Nandi, Narok, Nyamira, Nyeri, Samburu, Taita-Taveta, Trans Nzoia, Uasin Gishu, Vihiga, Wajir, West Pokot and Marsabit. 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."
}