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    "id": 533681,
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    "content": "caused by the court case and they were required to oblige to the court’s ruling in this regard. Mr. Temporary Speaker, Sir, the other thing I want to mention is that this year, the situation would be absolutely different. The ceilings will be based on an amendment that we passed. Another thing is that the total amount of money, as at mid this month, that has been released to county assemblies is Kshs12 billion out of the Kshs17billion. In fact, in the Report, you will find the table showing exactly how much money has been released to each county assembly and how much was in their budgets. Mr. Temporary Speaker, Sir, our position in this document is that it is our considered view, after looking at the ruling of the court, that the court held that by virtue of Article 216, the CRA was well within its mandate to issue the circular. That is why the court said that the circular was lawfully issued. According to the CRA and the Controller of Budget, the court further held that the recommendation by the CRA – although not binding on counties – should be given due consideration in the enactment of the budget for the reasons given. The law is very clear. Where there is a deviation from a recommendation by the CRA, even with regards to deviation of revenue, the County Revenue Allocation Act requires that the reasons for deviations must be disclosed. In other words, as much as possible, the spirit of the Constitution and the law is that recommendations by the CRA must be given due consideration. That is important. If you do not comply with what is indicated, then you must give a reason. That is why even in the Division of Revenue Bill, there are a lot of memoranda explaining why there is a deviation from the recommendations by the Treasury and others. According to our understanding, the Controller of Budget said that the situation has changed. In September last year, we passed an amendment to the Public Finance Management (PFM) Act. The amendment brought on board the recommendation which is now a legal requirement. The CRA has to recommend ceilings for both arms of Government. When we will be discussing, in the coming week the ceilings, you will appreciate that it is now binding as we go forward. The recommendations that we have issued in this Report are very clear. In summary, we have said that the county governments should establish conflict resolution mechanisms and desist from encroaching on each other’s constitutional mandate. This is where the challenge is. These are two arms of Government at the county level. But up to now, because of the fact that these are still new institutions, there is no respect by one arm of the other arm of Government for the other. There is no cooperation to the level that is expected, and this was expected in the Constitution. This is why intergovernmental dispute resolution mechanism was envisaged in Article 189 of the Constitution. The Intergovernmental Relations Act was established so that people do not need to go to court, even if they go through all the mechanisms of dispute resolution. It is in this regard that we have advised the county assemblies that if they have those kinds of challenges, they should refer their disputes to the Senate, if they are not able to resolve them. This is because financial allocation is a negotiated process in every government and a budget is a political instrument that is negotiated. 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."
}