County governments are running into a financial crisis amid revelations the National Treasury is yet to release more than Sh60 billion.
Controller of Budget Margaret Nyakang’o said counties last received disbursements in November last year.
“Most counties have less than Sh100 million in their accounts. They are using that to pay December salaries because they have not received any funds since November,” Nyakang’o said.
In an interview with the Star yesterday, the budget boss said most counties – especially those that entirely depend on the Treasury for funding – could soon run into a cash crisis.
“It is a reality; counties have not been given money. We have not heard from the Treasury, January is already ending,” Nyakang’o said.
The delayed release could cripple the provision of crucial services and development programmes.
The National Treasury has often blamed dwindling revenues and huge debt obligations on delayed disbursements of funds to counties.
Last year, the Treasury released more than Sh100 billion to the counties in a record month to avert paralysis following a four-month delay.
The governors had threatened to shut down operations due to the delays.
“We can’t be in November and we are talking of disbursements back to August,” Council of Governors chairperson Ahmed Abdullahi said.
“The National Treasury is yet to disburse Sh63.6 billion for October and November 2024 allocations.”
However, the Treasury reacted swiftly by releasing funds for up to November to avert what could have been a total paralysis in the counties.
“Today as I speak, we have transferred all the money meant to go to the counties until the end of October. Let them pay workers. Let them make this country liquid because there is money for them” Treasury CS John Mbadi said in November.
Section 17 of the Public Finance Management Act, 2012, obligates the Treasury to release an equitable share of revenues to counties by the 15th of every month.
That’s never the case. Last year, Treasury published details showing how the 47 county governments shared Sh3.5 trillion released by the national government over the past 11 years.
Treasury also observed that the disbursements over the years have been above the constitutionally set threshold of 15 per cent of the last audited and approved accounts by Parliament.
“Except for 2019/20, 2021/22 and 2023/24, the equitable share of revenue has been fully disbursed in accordance with Article 219 of the Constitution,” Mbadi said