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Kenyan Counties run out of cash for staff salaries amid row

From left: Bungoma Governor Ken Lusaka, Council of Governors chairman Isaac Ruto, Kwale Governor Salim Mvurya and Makueni Governor Kivutha Kibwana address the Press at their Delta House office in Nairobi on July 24, 2014. Although they protested that cash for counties was delayed, it emerged that 44 of the devolved units were yet to comply with new rules to check spending. PHOTO | BILLY MUTAI  NATION MEDIA GROUP

From left: Bungoma Governor Ken Lusaka, Council of Governors chairman Isaac Ruto, Kwale Governor Salim Mvurya and Makueni Governor Kivutha Kibwana address the Press at their Delta House office in Nairobi on July 24, 2014. Although they protested that cash for counties was delayed, it emerged that 44 of the devolved units were yet to comply with new rules to check spending. PHOTO | BILLY MUTAI NATION MEDIA GROUP

The counties would neither pay salaries for this month on time nor finance medical services as there was no money in their bank accounts, the governors said at a press conference in Nairobi.

The July salaries, expected to be paid on Friday, will have to wait until the money is released.

The chairman of the Council of Governors, Mr Isaac Ruto, said Parliament should take the responsibility for the paralysis.

MPs delayed passing the Division of Revenue Bill after failing to agree with senators on the funding for Level 5 hospitals.

Senators had proposed that the National Government spend Sh3.4 billion from its Budget to fund the hospitals but MPs wanted the counties to foot the bill from their allocations.

There was, however, hope by Thursday evening that the money could soon been transferred to the counties after both Houses passed the report of a mediation committee that found a middle ground between the MPs and senators.

The revenue Bill will now be forwarded to President Uhuru Kenyatta for assent to give the National Treasury the go-ahead to distribute the Sh226.6 billion to counties.

“Salaries may not paid by today as it has been the case. If Parliament passes the Bill by this week, we will be able to pay by next week. We will, however, not be able to buy medicine if we don’t get the money immediately,” said Mr Ruto.

However, even if the money was to be released immediately, governors will have to contend with County Assemblies whose budgets have been rejected by the Controller of Budget for ignoring directives on their spending.

It emerged on Thursday that Controller of Budget Agnes Odhiambo had turned down the budgets of 44 counties for not adhering to the recently issued caps on spending.

The assemblies have already moved to court to challenge the directive.

This means only three counties have met the conditions. However, neither Ms Odhiambo nor Mr Ruto disclosed which counties had complied.

Earlier, Mr Ruto had criticised Parliament for the delay in passing of the revenue Bill, saying it was unfortunate that legislators — who were entitled to medical schemes worth millions of shillings — were wrangling on how to fund public hospitals that were the only option for poor Kenyans.

“It’s callous for people with medical schemes to deny medical care to Kenyans whose first and last ports of call are public hospitals.”

He told off legislators for reducing the money allocated to Level Five hospitals from Sh3 billion to about Sh1.7 billion, saying this was happening at a time when the National Government could not account for billions of shillings at its disposal.

ABSLOVED FROM BLAME

The Council of Governors absolved its members from blame over allegations the counties had failed to utilise billions of shilling in their accounts. They said the money was already committed but could not be withdrawn due to stringent procurement rules.

Kwale Governor Salim Mvurya, who is the vice-chairman of the council, said counties had committed the money since March when the report was published and that by June this year, all the cash had been used, leaving the bank accounts dry.

Makueni’s Kivutha Kibwana said: “You cannot use money from any other vote to finance salaries and medical services.”

His Bungoma counterpart Ken Lusaka, who is the council’s whip, called on county assemblies and the budget oversight commissions to resolve their differences on spending caps to free cash for counties.

Adopted from Daily Nation

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