What you need to know:
- Sonko said that adjustments made to the executive’s earlier budget were unlawful.
- He now wants the assembly to reduce the budget to Sh31.6 billion from Sh37.5 billion.
- He also said the budget violates Article 5.2 and 5.3 of the Deed of Transfer of functions.
Nairobi Governor Mike Sonko has rejected the recently passed county budget for the financial year ending June 30, 2021.
Sonko refused to append his signature on the Nairobi City County Appropriations Bill, 2020, referring it back to the county assembly.
The Bill, which was passed by the assembly on October 8 approving a budget of Sh37.5 billion, left his administration with Sh8.4 billion against Sh27.1 billion allocated to the Nairobi Metropolitan Services (NMS), with the rest going to the county assembly.
“In exercise of the powers conferred on me by Section 24(2) (b) of the County Governments Act, 2012, I refuse to assent to the Nairobi City County Appropriation Bill, 2020,” said Sonko Thursday in his memorandum to Speaker Benson Mutura.
In the memorandum, the City Hall boss rejected the budget saying it had a huge deficit, called for allocations to NMS to be voided while also saying that adjustments made to the executive’s earlier budget were unlawful.
He now wants the assembly to reduce the budget to Sh31.6 billion from Sh37.5 billion in accordance with the County Fiscal Strategy Paper 2020/2021 and budget estimates presented to it by Finance Executive Allan Igambi in February and April respectively.
He argued that the budget has contravened provisions of the Public Finance Management Act 31(c) which provides that the total budgeted revenue and expenditure must be balanced.
“I have reviewed the Bill as presented to me for assent and the total budget and the total projected revenues for 2020/2021 financial year is Sh31.6 billion against the total expenditure of Sh37.5 billion, leaving a shortfall of Sh5.8 billion which is against PFM Act regulations,” he said.
Sonko also raised concern with adjustments made by the assembly to various votes saying they exceeded the one per cent threshold provided for in law.
He also said the budget violates Article 5.2 and 5.3 of the Deed of Transfer of functions which provides that funding for each transferred function shall be determined by the national government in consultation with the county government.
Consequently, he has rejected the allocation of Sh1.6 billion to NMS for inspectorate services, transfer of the Sh1.3 billion Ward Development Fund from his office to NMS as well as having entire allocations to Health, Urban Planning and Lands, Public Works, Transport and Infrastructure, Environment and Urban Renewal and Housing.
“NMS is not a delivery unit within Nairobi County government and therefore does not qualify to find its way in the appropriation as a vote for appropriation of funds,” said Sonko.
He argued that if the budget is allowed to stand, then it will amount to changing the structure of the executive without consulting it, adding that the county executive will have no funds to finance its operations such as payment of salaries for staff and any ongoing projects or pending bills.
Further, he pointed out that the budget that had been presented by Mr Igambi factored in unutilised cash balances at the end of the financial year ending June 30, 2020 of only Sh290 million and not Sh5.5 billion as had been put out by the assembly.
“It cannot be justifiable for the assembly to factor in the Sh4.5 billion budgeted for in 2019/2020 financial year but remained unspent as that violates section 136(1) of the PFM Act which says that an appropriation that has not been spent at the end of the financial year for which it was appropriated lapses immediately at the end of that financial year,” he said.