The May Equitable share allocation of Ksh.31.45B was released, with Kakamega, Nakuru, Turkana and Nairobi getting their lion’s share of Ksh.1.05 billion, Ksh.1.1 billion, Ksh.1.1 billion and Ksh.1.63 billion respectively.
While counties that received over Ksh.900 million but shy of a billion being Bungoma, Kiambu, Kilifi, and Mandera. Counties like Wajir and Meru got slightly over Ksh.800 million while Kitui headed to the bank for its Ksh.883 million.
Lamu and Tharaka Nithi trailed in their May allocation getting Ksh.263.98 million and Ksh.358.20 million respectively.
The law requires that counties get their month’s allocation not later than the 15th day of the subsequent month and the National Treasury on behalf of the National Government has shown improvement in this.
It is expected then that the June and the last allocation of the equitable share will be done before June 30, 2023 to help the counties do their end of year in time – though the NT gave the COG extension to year closure as July 15, 2023.
The extension will assist the counties clear pending items as it closes the 2022/23 budget and ushers in the 2023/24 budget.
For the FY 2022/23, the allocation of equitable share to the National Government was Ksh. 1,764,099,760,466 at 73.33 percent, County Government received Ksh.370,000,000,000 at 26.17 percent while Equalization Fund pocketed Ksh. 7,068,474,211 at 0.5 percent.
According to Murugi Ndai, an economic analyst, this is usually a very political, yet technical negotiation that takes weeks and months to arrive at.
“The CRA- from their technical perspective recommends its figure, the COG through their political and county pressures has their recommendation while the National government has its figures,” says Ndai.
The three parties, led by the Deputy President as the chair, sits in the Intergovernmental Budget and Economic Forum (IBEC), and strikes a compromise.
County Allocation of Revenue Act
In earnest, the National Assembly consequently, after enacting the Division of Revenue Act (DORA), moves on to enact the County Allocation of Revenue Act (CARA).
This has less politics during enactment as a formula is already set for the application. Setting the formula, however, is where technical and politics shows their divergence as witnessed last year in the senate while passing the 3rd formula. The formula has a 5 years maturity.
The CARA will also allocate various conditional and unconditional grants, sharable to the counties.