The role of the County Treasury in Kenya is important in the management of county government finances. The County Treasury is one of the departments of the county government and each of the 47 counties has a County Treasury.
The County Executive Committee member for Finance is the member of the County Executive Committee that is responsible for the financial affairs of the County and for the County Treasury. Therefore, he or she is the head of the County Treasury.
The Public Finance Management Act (PFM Act) of 2012 establishes and stipulates the role of the County Treasury in Kenya in Section 103.
The County Treasury should comprise the —
- County Executive Committee member for Finance;
- Chief Officer; and
- department or departments of the County Treasury responsible for financial and fiscal matters.
Section 104 of the Public Finance Management Act contains the general responsibilities of a County Treasury.
Subject to the Constitution, a County Treasury should monitor, evaluate and oversee the management of public finances and economic affairs of the county government including—
- developing and implementing financial and economic policies in the county;
- preparing the annual budget for the county and coordinating the preparation of estimates of revenue and expenditure of the county government;
- co-ordinating the implementation of the budget of the county government;
- mobilising resources for funding the budgetary requirements of the county government and putting in place mechanisms to raise revenue and resources;
- managing the county government’s public debt and other obligations and developing a framework of debt control for the county;
- consolidating the annual appropriation accounts and other financial statements of the county government in a format determined by the Accounting Standards Board;
- acting as custodian of the inventory of the county government’s assets except where provided otherwise by other legislation or the Constitution;
- ensuring compliance with accounting standards prescribed and published by the Accounting Standards Board from time to time;
- ensuring proper management and control of, and accounting for the finances of the county government and its entities in order to promote efficient and effective use of the county’s budgetary resources;
- maintaining proper accounts and other records in respect of the County Revenue Fund, the County Emergencies Fund and other public funds administered by the county government;
- monitoring the county government’s entities to ensure compliance with the PFM Act and effective management of their funds, efficiency and transparency and, in particular, proper accountability for the expenditure of those funds;
- assisting county government entities in developing their capacity for efficient, effective and transparent financial management, upon request;
- providing the National Treasury with information which it may require to carry out its responsibilities under the Constitution and the PFM Act;
- issuing circulars with respect to financial matters relating to county government entities;
- advising the county government entities, the County Executive Committee and the county assembly on financial matters;
- strengthening financial and fiscal relations between the national government and county governments in performing their functions;
- reporting regularly to the county assembly on the implementation of the annual county budget;
- taking any other action to further the implementation of the PFM Act in relation to the county.
Now that we have seen the role of the County Treasury in Kenya, what are its powers? A County Treasury has such powers as are necessary to enable it to carry out its functions and responsibilities under the PFM Act including-
- with prior notice, access any system of public financial management used by any of the county government entities and the internal controls used to monitor the system;
- taking appropriate measures, including the stoppage of funds, to deal with any failure of a county government entity to comply with the PFM Act;
- with prior notice, accessing the premises of a county government entity and inspecting all records and other documents relating to the financial affairs of that county government entity, kept by that entity;
- requiring county government entities to comply with all applicable norms or standards regarding accounting practices, budget classification systems and other public financial management systems as prescribed by the Accounting Standards Board;
- requiring any public officer employed by a county government or county government entity to provide explanations, information and assistance in respect to matters relating to the county government’s public finances: provided that a person providing the information shall not be liable if at the time of providing the information, that person, in writing, objected to providing such information on grounds that the information may incriminate him or her;
- issuing guidelines to accounting officers for the county government entities, or public officers employed by those entities, with respect to the financial affairs of that Government or those entities, and monitoring compliance with those guidelines;
- ensuring that county government entities operate a financial management system that complies with national standards as prescribed by the Accounting Standards Board.
For the detailed role of the County Treasury in Kenya, see Part IV of the Public Finance Management Act.