MPs pass revenue bill after Treasury resolves CDF row
By Anthony Mwangi, March 24, 2021National Treasury was yesterday forced to make a last-minute dash to convince MPs not to shoot down the Division of Revenue Bill by promising to release the National Government Constituency Development Fund (NG-CDF) cash which is in arrears.
The crucial Bill, which allocates revenue to counties was deferred last week after MPs shot it down protesting failure by the Treasury to allocate CDF money.
On Monday, Treasury released Sh6 million to each constituency but MPs were still reluctant to pass the Bill until the full amount of Sh65 million is released.
National Assembly Leader of Majority Amos Kimunya had to make frantic efforts shuttling between Parliament and the Treasury to have the matter resolved before the afternoon session kicked off.
A source said Treasury Cabinet Secretary Ukur Yatani managed to convince MPs that the remaining cash will be released in tranches starting next month.
The Division of Revenue Bill passed without hitches allowing Treasury to allocate money to counties.
MPs we talked to before the afternoon sitting said they had unanimously agreed to boycott the session until after the CDF money is disbursed to the board.
“We have agreed that we will not take part in any House business until after the CDF money is disbursed,” said Keiyo South MP Daniel Rono.
Nyali MP Mohammed Ali hit out at Yatani for playing with the minds of the MPs by failing to release the money as agreed last week.
“We agreed to pass the Supplementary Budget on the understanding the CDF arrears will be released in full. We are shocked to learn that only Sh6 million has been sent to the constituencies,” said Ali.
Rigathi Gachagua (Mathira) said MPs expected Sh65 million each for the financial year ending June.
“The agreement was that the arrears for the current financial year be released in full, only for Treasury to release Sh6 million. We are demanding for a commitment as to when the remaining Sh59 million for every constituency will be released,” Gachagua said.
Last Thursday, Yatani moved to avert a showdown ahead of the tabling of the Supplementary Budget by factoring Sh13.7 billion for the NG-CDF.
Special sitting
MPs had threatened to shoot down the Supplementary Budget when it is tabled this afternoon during a special sitting, which was convened for the purpose.
On Tuesday last week, MPs boycotted the sitting to deny it a quorum forcing Kimunya to drop the Division of Revenue Bill, which was coming for the Second Reading.
Treasury has failed to release Sh19 billion to NG-CDF, which has been in arrears in the last two financial years.
According to MPs, Treasury is holding Sh13.7 billion that had been allocated to CDF in the year to June 2020 and arrears of Sh4.97 billion that is owed to the 290 electoral areas from 2011/12 to 2014/15.
MPs were, however, skeptical on Yatani’s move saying they will wait for the money to be disbursed to the NG-CDF board before they take his word seriously.
Kimani Ichung’wah (Kikuyu) said the bigger concern is the disbursement of the money to the board.
“Yatani should not play mind games, we want money in the bank not in the books. It is not the first time that such promises are coming,” Ichung’wa said.
He added that CDF projects have stalled as only 30 per cent of the allocations have been released with three months to go before the end of the current financial year.
Chris Wamalwa (Kiminini) while welcoming Yatani’s move said he will pass the two bills as Treasury has shown interest in addressing issues raised by MPs.
“It is a sad situation on the ground, school-going children are home since there is no money for bursaries and most projects have stalled,” said Wamalwa.
The CDF is popular with MPs as they use it to endear themselves by initiating development projects at the constituencies.
National Assembly’ Select Committee on NG-CDF told Parliament in a report on the disbursement of the 2019/20 CDF allocation that a total of Sh28 billion had been released to constituencies as at August 4 last year, leaving a balance of Sh13.7 billion.
Treasury allocated CDF Sh41.7 billion, and each of the 290 constituencies was to receive Sh137 million for development in the year to June 2020.
The Treasury has since maintained the same budget in the 2020/21 financial year where each constituency will get Sh137, 088,879 inclusive of emergency reserve of Sh7.2 million. The CDF board will retain Sh1.95 billion or 5 per cent of the total CDF budgetary allocation for administration purposes.
Kanduyi MP Wafula Wamunyinyi, who chairs NG CDF committee, told Parliament that 13 constituencies had received full allocation for the year under review while 271 electoral areas got between 50 and 99 per cent of their annual allocation.
Six constituencies had received between 39 and 49 per cent of their total annual allocation.