Counties will be required to seek the approval of the Controller of Budget to withdraw money raised from levies such as land rates and licences if a government Bill becomes law.
This follows proposed amendments to the public finance law which gives the Controller of Budget oversight over cash held by counties in bank accounts.
The law is silent on whether counties can tap into money they collect as rates, parking fees and business permits held in banks before their transfer to their main account at the central bank.
The Constitution requires that all revenues generated be paid into the main accounts where approval of the budget is given before the cash is released for spending.
This loophole has allowed counties to spend cash with approval and from bank accounts that do not require the nod of the Controller of Budget.
“Money paid into a bank account designated as a county revenue collection account shall be promptly credited into the county exchequer account and shall be withdrawn in accordance with Article 207 of the Constitution and section 109 of this Act,” notes the government-backed Bill tabled by National Assembly Majority Leader Aden Duale.
“Despite the provisions of this section, no expenditure shall be paid out of a bank account designated as a county revenue collection account except as otherwise authorised by law.”
Article 207 of the Constitution and section 109 of the public finance law direct counties to seek the approval of the Controller of Budget before withdrawing money for their use.
This is in a bid to create accountability and ensure the governments follow budgets.
Counties operate a number of accounts from which they deposit cash raised from levies and rates before depositing the money in their main bank account.