COG Demands That The Sh125 Billion Owed To Counties Is Released Immediately

County governments have warned that if National Treasury does not solve distribution delays, they risk coming to a complete standstill.

Anne Waiguru, the chairman of the Council of Governors (COG) and the governor of Kirinyaga, has requested that the National Treasury release all of the funds owed to the devolved units. According to Ms. Waiguru, counties owe a total of Sh125.8 billion in back payments for the months of January, February, March, and April.

Speaking to the media after a meeting of Central Kenyan authorities from the national and county governments, Waiguru claimed that the delays had a negative impact on county operations.

“Delayed disbursement of funds has been a major threat to the devolved units’ functionality since 2013 and continues to put a strain on their operations,” stated Governor Waiguru.

According to the COG leader, the National Treasury consistently delays paying out money to counties. According to Waiguru, “the lack of funds was causing counties to delay paying employees’ salaries and remitting statutory deductions, issuing agency notices by the Kenya Revenue Authority (KRA), and/or attaching county governments’ bank accounts without taking into account the status of disbursement.” According to Waiguru, KRA additionally enforces fines for late tax payments, which further depletes county resources.

The governor stated that “counties are also paying enormous interest due to bank overdrafts from commercial banks used to close the fiscal gaps due to the delays.”

According to Waiguru, the buildup of unpaid debts that have resulted from the failure to pay vendors and contractors on time has exposed counties to legal action.

According to Waiguru, delays are stalling development projects and underutilizing budgets. They also make it difficult for counties to respond to catastrophes like floods and drought.