Experts Fault County Funds Sharing Recipe

The Constitution of Kenya, 2010 created a devolved system of government. The 47 county governments are responsible for socio-economic development partly through resources allocated from the National Government. A Commission for Revenue Allocation (CRA) was set up to come up with a formula of how these resources would be allocated. The first formula proposed allocations in the following manner: 60 per cent according to the population size; 12 per cent according to poverty levels; six per cent according to land size; and two per cent according to fiscal responsibility.

Society for International development hosted an experts forum to interrogate this formula and determine if it would enable counties to achieve equitable development especially in addressing the needs of marginalized groups / regions as stipulated in clause 201; as well as allocate the resources according to the developmental needs of counties and factor in the economic disparities within and among counties, the need for affirmative action and economic optimization of each county as stipulated in clause 203.

A summary of the proceedings of that meeting are captured in the article below

Author: PETER NG’ETICH

Contacts: pngetich@ke.nationmedia.com

Posted Wednesday, May 2 2012 at 22:30 and can be accessed from http://www.nation.co.ke/News/Experts-fault-county-funds-sharing-recipe-/-/1056/1398406/-/74p96a/-/index.html

Population experts want the formula for sharing county funds changed. The experts said the formula which the Commission on Revenue Allocation (CRA) should use must be based on poverty, rather than population.

Speaking in Nairobi at a workshop organized by the Society for International Development (SID), the experts, including University of Nairobi population scientist Dr Alfred Agwanda, said a formula based on population will perpetuate poverty in less endowed counties. “The lower end will not develop in tandem with the high end like Nairobi,” Dr Agwanda said.

He said some counties do not have an inch of tarmac road and basing the formula on birth rate would not bring equality, which the Constitution stipulates.

SID programmes coordinator Katindi Sivi-Njonjo said the 60 per cent allocated according to population should be reduced to 40 per cent and the difference redistributed to poorer end counties. “The formula should be pro-poor and funds for poverty increased from 12 per cent to at least 25 per cent,” she said.

Another expert, Dr Charles Karisa, said over-emphasis on the size of a county was wrong.“Size was over-emphasized. Area as a factor in allocating resources cannot stand alone. Inequality is the key to growth and poverty reduction,” Dr Karisa said.

But CRA director of legal affairs Sheila Ayieka said the formula was only a proposal that needed approval by Parliament. Last week, CRA chairman Micah Cheserem said money would be allocated to the 47 counties based on population (60 per cent), poverty levels (12 per cent), size (six per cent), and fiscal responsibility (two per cent).