The question of whether the counties can play oversight on the revenue county governments collect locally is important. In the past, county officials have blamed the Senate claiming it overstepped its mandate by overseeing the local revenue for counties.
The Senate, in return, hit back claiming they have a role to play in promoting accountability for the local revenue county governments collect. They said they have a say because they are the custodians of the interests of the counties.
However, the county governments insisted on the role of monitoring local revenue collection and implementation being a preserve of the County Assemblies.
Therefore, we ask, does the Senate have the authority to oversee local revenue collections made by the county governments?
Role of the Senate in the oversight of revenue
The Constitution of Kenya under Article 96 stipulates the role of the Senate. Article 96(3) specifically states the following–
The Senate determines the allocation of national revenue among counties, as provided in Article 217, and exercises oversight over national revenue allocated to the county governments.
Article 217 primarily empowers the Senate to determine the basis for allocating the national share of revenue (equitable share) among the counties. This money is allocated every year to the 47 county governments.
This equitable share should not be less than 15% of all the revenue collected by the national government based on the most recent audited accounts of revenue as received and approved by the National Assembly (Article 203).
When it comes to oversight, the Senate can oversee the national revenue allocated to county governments. This is as stipulated under Article 96(3) of the Constitution.
The Constitution established two mechanisms that facilitate the Senate’s oversight role. These mechanisms are under Article 228 and Article 229 of the Kenyan Constitution. They are the Controller of Budget and the Auditor General respectively.
The two are independent bodies that assist parliament to play the oversight role.
The Controller of Budget should submit reports on how the county governments are implementing their budgets every four months to both houses of parliament.
The Auditor General should submit audit reports, in the case of the county governments, to parliament or the relevant county assembly within six months after the end of each financial year (deadline being 31st December).
Petition No.8 of 2014
A petition filed at the Kerugoya High Court expounds on the role of the Senate in revenue oversight.
In the case, the petitioner represented the Council of Governors. They challenged the decision of the Senate to summon nine County Governors and County Executive Members responsible for finance. They were to appear before the Senate to provide evidence and information on county expenditure.
The respondent to the case was the Senate and its clerk. They did not take part in the case or file any response to the petition.
Let us go straight to the areas in the case that touches on the Senate oversight role. The High Court presented several interesting arguments.
First, it ruled that the Senate has the authority to summon the Governors or the County Executive Member for Finance to provide information or evidence on how the county government spent the national revenue allocated to it. Petition No.413 of 2014 reinforced this ruling.
Can the Senate oversee counties’ local revenue?
On whether the Senate has jurisdiction over the revenue generated locally by the county governments, the High Court ruled otherwise.
The Court ruled that the role of the Senate under Article 96(3) could not be likened to that of the County Assembly under Article 226(2) of the Constitution.
The Court noted that, while the County Assembly has the wider portfolio of oversight over both the revenue generated locally by the county governments and the national revenue allocated to the counties, the Senate’s oversight role is restricted to the national revenue allocated to the counties.
What that means is that the Senate has no authority to oversee the sources of county government revenue other than the equitable share.
Yet, the Court noted that the Senate and the County Assembly have a joint oversight role. However, this role only applies to the national revenue allocated to the counties.
If you want to get notified when I publish a new post, join our Newsletter