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Lawmakers from the two chambers of Parliament will meet for mediation after the National Assembly rejected proposals from the Senate to increase allocations to counties by Sh25 billion, from the Sh391 billion earmarked in the Division of Revenue Bill to Sh415 billion.

MPs rejected the Senate proposal after the Budget and Appropriation Committee (BAC), chaired by Kiharu MP Ndindi Nyoro, warned that this would affect the Road Maintenance Levy Fund (RMLF) and the National Government Constituencies Development Fund (NG-CDF), which would have to cough up Sh10 billion each .

The Finance and Budget Committee, chaired by Senator Ali Roba (Mandera), had proposed that the government get Sh2.5 trillion and counties Sh415.9 billion for the 2024/25 financial year.

The committee said the proposal was based on adjusting the base of Sh385 Billion to take into account non-discretionary financial obligations relating to the affordable housing levy deductions, enhanced contributions to the NSSF, the Social Health Insurance Fund (SHIF), and for counties to match allocations for industrial parks.

But yesterday, in a session characterised by shouting matches and heated exchanges, Nyoro explained that the NSSF and SHIF will suffer as the committee had previously lobbied for more money to go to them.

He explained that it would be difficult for the government to get Sh25 billion to top up the allocation to counties as the government cut its budget by a whopping Sh273.3 billion after it collected less revenue than expected.

He said: “Whereas it is obligatory for me to bring a motion, I rise to reject the Senate amendments. Currently, we are dealing with a deficit-to-GDP ratio of 2.9 percent, which is a modest deficit. We want to cap our deficit to 2.9 percent.

“Whatever the budget we are giving to the counties, then something has to suffer. We do not have an open envelope. Even as we make the current budget, it is proper we know that the estimates we are considering are not elastic. If we are to consider this, certain votes have to give way.”

He added that if they were to give counties more money, they will have to slash the RMLF going to counties by Sh10 billion and the NGCDF by Sh 10 billion to get to sharable revenue.

“This is one of the reasons why the BAC rejected this report. I request this House to agree with BAC. We reject this motion so that we can go to the mediation committee so that we can save the said figures that we have already ringfenced,” Nyoro  said.

Besides Nyoro, the other eight members of the mediation committee selected by National Assembly Speaker Moses Wetangula to join their Senate counterparts are Mary Emase (Teso South), David Ochieng (Ugenya), Nyakundi Mokaya (Kitutu Chache North), Samuel Moroto (Kapenguria), Moses Atandi (Alego Usonga), Naisula Lesuuda(Samburu West), Makali Mulu (Kitui Central) and Ali Wario (Garsen)l.

Emase urged the House to save the NGCDF and RMLF from cuts. She said: “I second the rejection of the bill. The discussion is about the variance. The National Assembly proposed Sh391 billion, while the Senate proposed Sh415 billion. The issue is where the 24 billion will come from.

“You have heard this money must come from somewhere – either RMLF or NGCDF. You all understand the economy we are operating in. We are in a tight corner and we can’t afford this.”

Because of the important work the two funds do, said Majority Leader Kimani Ichung’wa, lawmakers would not allow allocations to them to be slashed.

“I rise to agree with the BAC that it is important that we make decisions when we are all aware that choices have consequences. You all know we have had issues with governors on the fuel levy. They have been asking for the Sh10 billion and if we agree with this, the BAC has to give it away,” he said. “Also, you all know that NGCDF will be affected, yet we celebrated this fund for being in existence. If you take this away, then we suffer.”

Counties, proposed Majority Whip Sylvanus Osoro, should not get any more allocations as they are yet to utilize what they received. He said: “Devolution came in 2013 but can hardly show what it has done. NGCDF has been here and its presence has been felt by counties.

“Some of these county governments have a lot of money and they have not even been able to spend the monies given to them. We are getting into the closure of this financial year. Some of these governors have done nothing.”

But Minority Leader Opiyo Wandayi, Minority Whip Junet Mohamed and Migori Woman Representative Fatuma Mohammed told Nyoro to stop saying that NGCDF and RMLF will be affected if counties get Sh25 billion more.

Said Wandayi: “I support the motion. I agree in totality with the Senate recommendations. In our own calculation, counties need much more than what you have allocated them. 

“The Senate is not telling us to remove money from NGCDF amd RMLF – it is only telling us that we need more money. It is incumbent on us to look at how much money we need.”

Junet accused BAC of trying to kill devolution. “I stand to support the amendments of the Senate. Let’s be honest, I have seen a billion shillings for the first time. We cannot be used as a House to kill devolution,” he said.

“The Senate has only asked for an increment – they have never said the money be removed from NGCDF or RMLF. What I am saying is that we must send more money to the counties.”

Said Mohammed: “The other side is blackmailing us. I don’t see anywhere the Senate is saying the money will be taken from NGCDF.”