(Nairobi) – The National Treasury has confirmed it has disbursed KSh 30.8 billion to counties and cleared all arrears, with only November’s payments remaining outstanding.
The National Treasury on Monday clarified that it has cleared all arrears to counties, stating that the only outstanding payment is for the month of November. The Treasury explained that KSh 158 billion has been disbursed to counties, covering arrears from June 2024 as well as payments for the months of July, August, September, and October.
This announcement comes after the Council of Governors (CoG) issued a warning about the potential impact of delayed disbursements on the operations of county governments. Governors had raised concerns that further delays in receiving the necessary funds could disrupt service delivery, especially with the December deadline approaching.
According to the National Treasury, all payments to county governments were up to date as of October 18, 2024, except for the current month. The Treasury also reiterated that funds to counties should be transferred by the fifth day of each month to ensure smooth operations at the county level.
However, the CoG has expressed its frustration over the delay in the passage of the County Allocation of Revenue Act (CARA), a key legal framework that governs how funds are allocated to the devolved units. This delay, combined with ongoing financial uncertainty, has placed immense pressure on county governments. They have not yet received their full equitable share for the 2024/25 financial year.
Cabinet Secretary for the National Treasury, John Mbadi, previously attributed the delays in the disbursement of county funds to legal and administrative challenges. One of the main issues has been a stalemate between the Senate and the National Assembly regarding the Division of Revenue (Amendment) Bill.
In early November, the National Assembly’s Budget and Appropriations Committee failed to reach an agreement on the bill, further escalating uncertainty for counties. The sticking point revolves around a proposed reduction of Sh20 billion, which the National Treasury is seeking, but which has been rejected by the Senate. The Senate has insisted that once funds are allocated to the counties, they cannot be reduced.
The Senate’s opposition to the Treasury’s proposal of a KSh 380 billion allocation for counties has led to a continued deadlock, complicating the timely distribution of funds to the devolved units. Despite these challenges, the Treasury has assured county governments that once the November payment issue is resolved, they will be fully up to date with all obligations.