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{
    "id": 904155,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/904155/?format=api",
    "text_counter": 208,
    "type": "speech",
    "speaker_name": "Sen. (Eng.) Mahamud",
    "speaker_title": "",
    "speaker": {
        "id": 373,
        "legal_name": "Mohammed Maalim Mahamud",
        "slug": "mohammed-mahamud"
    },
    "content": "effective accountability and transparency in budget implementation, as budget estimates are prepared in a programme based format, as provided for in Section 130 of Public Finance Management (PFM) Act, 2012. Moreover, county appropriations are also by programme, for both recurrent and development expenditure. The CoB implementation reports do not provide information on the extent to which the amounts received by counties comply with the Cash Disbursement Schedule approved by the Senate. This means that the releases to counties are not based on the approved Cash Disbursement Schedule, and thus, subject to discretion. This may pose inherent risks including negating the provisions of Article 219 of the Constitution on the need to transfer county allocations, without undue delay or deductions except where it involves stoppage as per Article 225 of the Constitution. The total approved county budgets amounted to Kshs410 billion, made up of Kshs270 billion, which is 66 per cent recurrent and Kshs139.81 billion, which is 34 per cent for development for the period under review. In aggregate terms, this level of approvals before budget implementation indicates compliance to the fiscal rules that stipulate that at least 30 per cent of the total county allocation is towards development outlays, while not more than 70 per cent is approved for recurrent activities. This is to foster strategic use and improve allocative efficiency of county resources. However, a compliance review for individual counties indicates that five counties breached the legal threshold, while the other 42 counties were at between 30 to 47 per cent development allocation. The non-compliant counties included Bomet, Garissa, Taita- Taveta, Nairobi City and Kiambu. With regards to county actual expenditure performance, total expenditure for the Financial Year 2017/2018 amounted to Kshs303 billion. This translated to expenditure level of 74 per cent against the approved budget. Moreover, this expenditure level is also lower compared to the previous years of 2016/2017 and 2015/2016. Recurrent expenditure amounted to Kshs236 billion, which is 87 per cent of the total recurrent budget. This is also relatively higher than that of the previous year, which was Kshs215 billion. A further review indicates that 28 counties are below 50 per cent utilisation of development budget, while 19 counties reflect expenditure performance between 52 per cent and 76 per cent. On recurrent expenditure, Laikipia County had the highest expenditure performance at 99.4 per cent, while Vihiga County had the least expenditure of 62.03 per cent. In view of the actual expenditure, compliance to fiscal rules deteriorated during the budget execution, perhaps due to reallocation and virements of allocations between programmes towards the current expenditure over the implementation period. Only nine counties, that is 19 per cent of the counties, maintained the development recurrent mix threshold. Thirty eight counties did not comply. This implies that any approved allocation towards recurrent activities affects the creation of asset capacity and poses a potential risk to county expenditure performance. Moreover, the underperformance of development expenditure adversely affects county development plans and delays implementation of key county programmes and projects. The electronic version of the Senate Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor, Senate."
}