The devolved units were on the verge of losing out on the cash due to lack of legislation
County governments will soon get Sh40 billion in grants after a Bill that seeks to unlock the money stuck at Treasury for lack of enabling legislation is passed into law.
The County Governments Grants Bill, 2021 provides a legal framework for the release of the conditional grants and donor funds to the devolved units by the National Treasury.
“The Bill proposes to allocate county governments conditional allocations amounting to Sh7.53 billion from the national government and Sh32.34 billion as conditional allocations financed from loans and grants from development partners,” the Bills reads in part.
The Bill, sponsored by Senate Finance and Budget Committee chairman Charles Kibiru (Kirinyaga), was introduced in the House for First Reading on Tuesday.
The counties were on the verge of losing out on the cash after Parliament expunged the allocation from the Division of Revenue Bill reference to conditional grants.
The move was in line with High Court ruling that the Division of Revenue Bill—that shares funds between national and county governments— and the County Allocation of Revenue —that splits funds among the 47 counties— shall not include the grants.
According to the Bill, grants shall be released to the county revenue funds accounts upon compliance with the conditions set out by the National Treasury for the funds.
The conditions shall be contained in an agreement signed by the Treasury and the respective county government.
“An agreement under subsection (1) shall set out all conditions attached to an allocation made under this Act,” it states.
The National Treasury shall enter into an agreement with the respective county government for the transfer of the respective conditional allocation made to the county government pursuant to this Act.
Such an agreement, the Bill states, shall be approved by the county assembly within days of submission by the county Finance executive.
Where a county assembly fails to consider an agreement within seven days, the agreement shall be deemed to be approved.
“The county executive shall facilitate public participation on any agreement made pursuant to the provisions of this Act,” it states.
On the other hand, Treasury CS shall, within seven days of entering into an agreement, submit to the Senate the agreement together with any other documents relating to it.
The Bill states conditional allocations to each county government from national government for the financial year 2021-22 shall be as set out in Column D of the First Schedule.
This grant comprises Sh332 million allocations for the construction of headquarters to five counties and Sh7.20 billion for the leasing of medical equipment.
“This will facilitate easy access to specialised health care services and significantly reduce the distance that Kenyans travel in search of such services today,” it states.
The proposed law provides that conditional allocations financed by proceeds of loans or grants from development partners to each county government for the financial year 2021/22 shall be as set out in Column N.
It includes the World Banks’s Sh2.2 billion Transforming Health Systems for Universal Care Project.
This conditional allocation through the Ministry of Health is meant to improve delivery, utilisation and quality of primary health care services with focus on reproductive, maternal, new-born, child and adolescent health at the county level.
It also comprises Danida’s Sh701 million for Grant-Primary Health Care in Devolved Context programme, National Agricultural and Rural Inclusive Growth Project funded by World bank to the tune of Sh6.4 billion.
It also includes Sh2.8 billion advanced by the World Bank for the Kenya Informal Settlement Improvement, European Union’s 230.7 million for Instruments for Devolution Advice and Support and Kenya Climate Smart Agriculture Project supported by World Bank to the tune of Sh7.8 billion.
Others include Water and Sanitation Development Project funded by the World Bank to the tune of Sh5 billion, Sh1.3 billion Agricultural Sector Development Support Programme, Sh370million Drought Resilience Programme in Northern Kenya and the Kenya Devolution Support Program undertaken at a cost of Sh4.6 billion.
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