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How counties shared billions from donors

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Counties
Friday July 15 2022

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Commission for Revenue Allocation chairperson Jane Kiringai. FILE PHOTO | NMG

Nairobi, Meru, Kiambu, Kilifi, Nakuru and Mombasa topped the list of counties that received the highest amounts in loans and grants from the Sh196 billion disbursed by development partners in the last nine years.

New data by the Commission on Revenue Allocation (CRA) capturing the nine years of devolution up to the current financial year shows that Nairobi had a total of Sh12.3 billion in loans and grants from development partners.

This was followed by Meru at (Sh10.4 billion), Kiambu (Sh8.8 billion), Kilifi (7.3 billion) and Nakuru got Sh6.3 billion.

The Constitution allows counties to borrow from the capital markets and foreign sources once cleared by the National Treasury.

Article 212 of the Constitution states that a county government may borrow only if the national government guarantees the loan and with the approval of the county government assembly.

The data by the CRA does not classify what amount of the funds are loans and what portion of the funds were grants.

“It is the expectation of the Commission that policymakers will use these fact sheets to formulate policy. More importantly, the Commission hopes that citizens will use the third edition of the County fact sheets to hold their leaders accountable,” says CRA chair Dr Jane Kiringai in the report.

According to the report, Mombasa took in Sh5.8 billion followed by Machakos (Sh5.7 billion), Garissa (Sh5.2 billion), Wajir (Sh5 billion), and Kisumu (Sh4.9 billion).

Kakamega had a total of Sh4.8 billion with Kwale taking up Sh4.8 billion, Migori (Sh4.7 billion), Bungoma (Sh4.6 billion) with Uasin Gishu, Taita Taveta and Homa Bay tying at Sh4.2 billion.

Under the law, county governments can only access money from external sources if the national government guarantees the loan.

Kitui chalked up Sh 4.1 billion followed by Makueni (Sh3.7billion), and Turkana (Sh3.6 billion) with Kisii and Vihiga tying at Sh3.3 billion.

Trans Nzoia, Nyeri and Kajiado tied at Sh3.3 billion while Narok, Marsabit, Mandera, and Embu tied at Sh3 billion.

Kirinyaga, Murang’a, Kericho, Elgeyo/Marakwet, all took in Sh2.9 billion while Siaya, Tharaka Nithi, Busia had total loans amounting to Sh2.8 billion.

Meanwhile, Nyamira had Sh2.7 billion while West Pokot, Samburu, Bomet and Baringo tied at Sh2.6 billion.

Nyandarua and Laikipia had Sh2.5 billion while Tana River, Isiolo and Lamu stood at Sh2.3 billion, Sh2.2 billion and Sh1.6 billion at the bottom of the pile.

Counties must raise at least 15 percent of project funds from their own internally generated resources before the national government can guarantee their borrowing.

In the stringent conditions for the devolved units aimed at curtailing reckless borrowing, counties are also required to be assessed on their loan repaying ability over the medium term, meaning counties that are in the red will be blacklisted from external borrowing.

“A county government for which a guarantee is requested shall contribute a substantial portion of project funds from their own resources and in any case not less than 15 per cent,” said National Treasury Cabinet Secretary Ukur Yatani in a circular last year.

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Source : Businessdaily Africa

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