NAIROBI, Kenya, Mar 9 – Controller of Budget Margaret Nyakang’o has cited the delay in enacting the Government Additional Allocations Bill and underperformance in the collection of own-source revenue as key challenges hindering the effective budget execution by the 47 county governments.
These observations are contained in the First Half County Governments Budget Implementation Review Report (CGBIRR) for the 2024/25 Financial Year, covering the period from July 2024 to December 2024.
Nyakang’o further criticized county governments for the late submission of financial and non-financial reports, as well as non-adherence to the Exchequer Workplans they submitted to her office. This often leads to delays in the authorization of withdrawals from the Consolidated Fund to the respective County Revenue Funds (CRF) accounts by the Controller of Budget.
The report also highlights that counties are overly dependent on revenues from Appropriations in Aid, particularly the Facility Improvement Fund in the health sector.
“Based on the findings, the Controller of Budget recommends that county governments enhance, explore and grow other own-source revenue streams during the remaining period of FY 2024/25,” Nyakang’o stated.
The Controller of Budget has also urged the National Treasury to collaborate with key stakeholders to expedite the automation of the exchequer process for county governments, which will ensure that approved exchequer workplans are linked to actual execution.
To improve county governments’ budget implementation, Nyakang’o advised Parliament and relevant stakeholders to fast-track the resolution of outstanding issues related to the mediation in the County Governments Allocation Act Budget (CGAAB), facilitating its enactment and assent into law.
The Sh15.3 billion allocation to counties, which was slashed by the National Assembly, remains a point of contention, with the Senate and the Council of Governors demanding its reinstatement.
The objective of the Bill is to provide additional allocations from proceeds of loans and grants from development partners. It proposes facilitating conditional and unconditional allocations made to counties from the Consolidated Fund to the respective County Revenue Funds and special purpose accounts.
Nyakang’o has also advised county governments to adhere to their plans for paying pending bills to prevent them from spiraling out of control.
“Robust project planning, monitoring, and implementation mechanisms should be adopted to improve the absorption rate of development funds. Financial and non-financial reports should be submitted to the Controller of Budget promptly during the next reporting period,” the Controller of Budget report concluded.