Showdown looms as Yatani freezes revenue for 17 counties

Acting Treasury CS Ukur Yatani has set himself for a new showdown with 17 counties after the freeze of equitable share transfers over inaction on the clearance of pending bills.

Conspicuously, 16 of them were previously to receive a share of the Ksh. 31.2billion in the outstanding sharable revenue for November having shown the will to clear the said balances to suppliers.

However, the 16 have now been flagged for failing to present clear and elaborate plans on the clearance of the pending sums to see the freeze of Ksh.3.4 billion.

They include Turkana, Kisumu, Samburu, Nakuru, Murang’a, Mandera Kisii, Busia, Marsabit, Bungoma, Siaya, Trans-Nzoia, West Pokot, Kakamega, Wajir and Lamu.

From the originally non-compliant 15 Counties, Nairobi is added to the list with the highest pending bills amounting to Ksh.9.8 billion as per Treasury documents dating to October 28, 2019.

On Wednesday, the National Treasury released a total of Ksh.18.4 billion shillings to the remaining 30 Counties after giving a clean bill of health to 18 units for submitting satisfactory frameworks on the clearance of Ksh.13.9 billion in eligible outstanding bills.

The issuance has consequently let 14 Counties off the hook with the units having previously risked going without the equitable transfers to include Narok, Machakos, Vihiga, Isiolo, Tana River, Migori, Tharaka Nithi, Bomet, Kirinyaga, Nandi, Mombasa, Kiambu, Garrisa and Baringo.

New battle lines

On  November 11, State House through the office of the Head of Public Service issued orders deemed as urgent on the freeze of transfers to counties who had failed to comply with the directive on the clearance of pending bills.

The order stemmed from a June 18 meeting by the Fred Matiang’i chaired Intergovernmental Budget and Economic Council (IBEC) which required County governments to establish pending bills resolution committees.

The new freeze is however in defiance to the Parliamentary Budget and Appropriations Committee (BAC) rejection of the proposal to stop the said county transfers.

The National Treasury has however stood firm on the block sighting Article 225 of the Constitution and section 94 of the Public Finance Management Act on material breaches to first charge items to cover the clearance of outstanding supplier bills.

Yatani has however garnered the backing of the office of the Controller of Budget (COB) with Acting COB Stephen Masha having defended the position of Treasury during his appearance in the Senate on December 3.

The new freeze is however set to draw the wrath of the Council of Governors (COG) who have previously reiterated on the negative impact of exchequer denials on day to day county operations.

The suspension further puts into doubt the clearance of part of the outstanding arrears to suppliers while heightening the risk of the creation of new pending bills.

12 counties have however strayed clear of transfers fall out having held no outstanding eligible bills as at the end of October.

They include Elgeyo Marakwet, Homabay, Kajiado, Kericho, Kilifi, Kwale, Laikipia, Makueni, Nyamira, Nyandarua, Nyeri and Uasin Gishu.