There is finally some relief in the counties as the National Treasury released their pending financial allocation of Sh31 billion for February.
As a result, the Council of Governors (CoG) has withdrawn its threat to shut down the devolved units. Both parties have also reached an agreement on the settlement of the balance as the 47 counties had not received their remittances for months.
The 14-day notice issued by the CoG on April 24 had caused consternation among Kenyans as the county governments have in the 10 years of devolution played a pivotal role in development.
The governors blamed the perennial delays by the Treasury to disburse funds for the high interest they incur on bank overdrafts. Entitled to an equitable share of national revenue, they are still owed Sh29.6 billion for March.
It is encouraging to note that the Treasury has pledged to ensure prompt disbursements. The March allocation will be released by May 15 and the April one by month-end.
Because counties depend almost solely on the Exchequer, their operations are often disrupted by such delays. Some have not been paid salaries for several months. With the partial disbursement, they can at least fix some of their urgent needs.
They should, therefore, quickly address pending bills as their suppliers and contractors cannot meet their requirements and continue working if there is no return on investment.
However, the financial crisis may not go away any time soon. This begs the question as to whether the counties are, indeed, viable. Some time ago, there was a lot of excitement over the setting up of blocs to enable them to pool resources and invest in major infrastructural projects. This should be revisited.
The counties must also improve their management of resources and explore the generation of their own revenue to complement the Exchequer disbursements. They should shun the tendency to go for easier “short-term measures” such as expensive bank overdrafts to seal financial gaps.
This calls for financial discipline and the ability to live within their means.
