With just a month left in the financial year, the National Treasury has yet to release Sh98 billion to county governments. Documents show that as of Thursday, the devolved units have only received Sh287.14 billion out of the total allocated Sh385.42 billion for the current financial year.
The outstanding funds cover disbursements for April, May, and June, according to a cash disbursement status report from the Controller of Budget. This delay is threatening to disrupt crucial operations and service delivery across counties.
On Thursday, the Treasury released Sh20.78 billion to clear arrears for March, following a release of Sh10.05 billion the previous day for 17 counties, including Baringo, Bomet, Elgeyo Marakwet, Isiolo, Kajiado, Kakamega, Kirinyaga, Kitui, Laikipia, and Kwale. Other counties such as Narok, Samburu, Siaya, Taita Taveta, Tharaka Nithi, Uasin Gishu, and West Pokot also received their funds.
These revelations highlight significant cash flow challenges within the government. Ideally, the Treasury should have released the entire Sh385.42 billion equitable share to the counties by now. The law mandates that funds be disbursed by the 15th of each month, a requirement that has not been met, with delays stretching up to four months.
Governors have frequently lamented these late disbursements, which hinder effective service delivery. Council of Governors chairperson Anne Waiguru expressed concern, noting the unprecedented backlog and emphasizing the dire situation. She remains hopeful that Treasury interventions will resolve the issue.
Kakamega Governor Fernandes Barasa, chair of the CoG Finance committee, questioned the persistent delays, stressing that unresolved payments hinder the completion of stalled projects. Similarly, Kisii Governor Simba Arati highlighted that delayed disbursements have stalled key development projects, forcing funds to be diverted to salary payments instead of development.
The National Treasury attributes the delays to cash flow challenges stemming from underperforming revenues and significant public debt obligations. Treasury CS Njuguna Ndung’u informed MPs last year that revenue shortfalls and high debt obligations were causing the delays.
Additionally, counties have been criticized for their own underperforming revenue collections, which exacerbate their dependence on national government funds.
