Standoff as MPs, senators fail to agree on cash to counties

Lawmakers remain deadlocked over county funding, with the Senate demanding Sh400 billion while the National Assembly advocates for Sh380 billion.

This standoff has led to financial strain on counties, with the mediation process highlighting a lack of trust between the two Houses.

In a meeting, Thursday, Senate Finance Committee Chairman Ali Roba and National Assembly Budget Committee Chairman Ndindi Nyoro co-chaired the 18-member meeting where they called for level-headed discussions.

Nyoro emphasised the national budget’s recent reduction from Sh4.2 trillion to Sh3.8 trillion due to austerity measures following the June protests.

He stated: “We are where we are today over the happenings in the country in June that led to the Finance Bill 2024 being dropped. This is not a question of who is supporting devolution or not since we all support counties and we are here to look for a solution on the way to go forward.”

The Kiharu MP explained that the revised budget allocates Sh700 billion to development, Sh1.2 trillion to the consolidated fund, Sh750 billion for debt servicing, and Sh380 billion as the equitable share for counties. He criticised the Council of Governors’ legal tactics, describing them as “in bad faith” and a form of “blackmail” against the National Assembly.

Roba called on Senators and Members of National Assembly to look at the matters raised objectively bearing in mind they are doing it for posterity.

He said some members had demonised devolution but now through the grace of God were serving as Governors.

“We had senators and members of National Assembly who were very critical of devolution but they are now Governors and are now singing a different tune all together, let us keep in mind that whatever we are doing is for posterity,” said Roba.

Senators insisted on the Sh400 billion figure, citing recommendations from the Commission on Revenue Allocation.

Nairobi Senator Edwin Sifuna challenged the National Assembly to justify the proposed reduction: “Let me make it clear that the Senate will not agree to the reduction of the figures below what was allocated in the previous financial year where counties got Sh385 billion. The National Assembly needs to explain to us clearly why counties should be given Sh380 billion and not Sh400 billion.”

Sifuna accused the National Assembly of blackmail, noting that senators are acting within their constitutional mandate and are not willing to compromise on county funding.

“The National Assembly is out to blackmail counties to achieve their goal,” he said, arguing that linking the funding dispute to other issues such as the Constituency Development Fund is disingenuous.

Migori Senator Eddy Oketch underscored the financial pressures facing counties, saying: “The Sh400 billion allocated to counties cannot accommodate all their needs.” He warned that reducing this figure would mean “literally defunding counties” while Nominated Senator Veronica Maina pointed out that counties already face “huge pending bills” affecting many stakeholders who are owed significant sums.

Funyula MP Godfrey Oundo suggested the Senate should address fiscal inefficiencies in county governments, questioning why counties fund services outside their mandate, such as bursaries.

“Why should county governments, for example, give bursaries which is not their responsibility?” he asked. “Senators should go back to the Council of Governors and hold a candid discussion with them before coming back to us.”

Soi MP David Kiplagat urged the Council of Governors to abandon litigation against the National Assembly, advising a cooperative approach.

He commented, “There are several instances where governors are fighting the National Assembly yet they expect to get support from them.”

Kitui Central MP Makali Mulu acknowledged a general agreement on the Sh400 billion target for counties but questioned how the funds would be sourced, given that the Finance Bill 2024, meant to generate additional revenue, was shelved. “The question is, where do we get Sh20 billion extra to be given to counties, bearing in mind this is a very unique year where we do not have a finance bill,” he stated.

Mombasa Senator Mohammed Faki raised concerns about the financial constraints on county governments, which cannot borrow to address funding shortfalls. “While the National Government is able to borrow in case of a deficit, the county governments are not able to do so, and we will not be assisting devolution by reducing allocation to counties,” he said.

Ugenya MP David Ochieng cautioned against undermining the relationship between the two houses through court battles, citing the United States as an example where legislative disputes are resolved without litigation. “We all serve the same people,” Ochieng remarked. “Kenyans want service delivery and do not care much about who delivers what.”

The mediation team will reconvene on Tuesday in an effort to break the impasse, with senators and MPs alike under pressure to find a solution that addresses both fiscal prudence and the financial needs of counties.