The Star (Kenya)

Se­nate lead­ers back dis­puted pro­posal

- JULIUS OTIENO/ Finance · Politics · Business · Congress of the United States · Uhuru Kenyatta · Raila Odinga · Ken Lusaka

Se­na­tors are likely to ap­prove the House Fi­nance and Bud­get com­mit­tee’s pro­posal on the third ba­sis of rev­enue shar­ing among the 47 coun­ties when they as­sem­ble on Tues­day.

This fol­lows the en­dorse­ment of the pro­posal by the Se­nate lead­er­ship com­pris­ing al­lies of Pres­i­dent Uhuru Keny­atta and ODM boss Raila Odinga.

The pro­posal has been at the cen­tre of a pro­tracted dis­pute among the law­mak­ers. “The for­mula pro­posed by the Se­nate Fi­nance com­mit­tee be adopted as the new ba­sis for al­lo­cat­ing rev­enue to coun­ties,” a pol­icy brief seen by the Star reads.

The brief was handed to the House lead­er­ship led by Speaker Ken­neth Lusaka and will likely in­form the de­bate and vote when the House con­venes. It rec­om­mends that the for­mula be im­ple­mented in a phased man­ner to avoid dis­rupt­ing county plans and bud­gets and rec­om­mends a two-year mora­to­rium.

The Fi­nance com­mit­tee for­mula has been at the core of a stand­off as it cuts al­lo­ca­tions to 18 less pop­u­lous coun­ties by Sh17 bil­lion.

It pro­vides for a 10-pa­ram­e­ter for­mula, with the big­gest weight placed on health (20 per cent) and ba­sic share (also 20 per cent), pop­u­la­tion (16 per cent) and agri­cul­ture (12 per cent).

In a bid to en­sure that rev­enue losses are min­imised, the brief states that if the pro­posal is adopted, no county should lose more than 10 per cent its pre­vi­ous al­lo­ca­tions.

“Coun­ties whose rev­enues are bound to re­duce as a re­sult of the new for­mula should be cush­ioned (from Year 3) to avoid rev­enue shocks. A 10 per cent cush­ion against an agreed base­line (202021) [Sh316.5 bil­lion] is pro­posed,” the lead­er­ship pro­posed.

If this is adopted, there will be no loser or win­ner as ev­ery county will get the ex­act al­lo­ca­tion re­ceived in 2019-20. The com­mit­tee pro­poses that the al­lo­ca­tion this fi­nan­cial year should be based on the sec­ond gen­er­a­tion for­mula and the 2009 pop­u­la­tion data.

 ?? /EZEKIEL AMING’A ?? Se­nate Rev­enue For­mula Se­lect Com­mit­tee dur­ing a break out­side the cham­ber on Au­gust 24
/EZEKIEL AMING’A Se­nate Rev­enue For­mula Se­lect Com­mit­tee dur­ing a break out­side the cham­ber on Au­gust 24

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