PARLIAMENT UPDATE (July 20th-31st, 2020)
The National Assembly:
The National Assembly held 2 sittings within the stipulated weeks.
Tuesday 28th July at 2:30 pm:
The Public Procurement and Asset Disposal (amendment) Bill (National Assembly Bill no. 20 of 2020) underwent its first reading. This amendment seeks to bring the local contractors at par with their foreign counterparts, in that payment deadlines for local contractors and subcontractors are always not observed by both the national and County governments where as the foreign counterparts have support by their mother countries and are paid via letter of credit. It further amends section 54 and 86 of the principal Act, (Public Procurement and Asset Disposal, 2015) by inserting new subsections and inserting an additional section after section 141 that addresses the payment of local contractors.
Further, the Public Finance Management (amendment) (no.2) Bill (National Assembly Bill no. 23 of 2020) underwent a second reading. The object of this Bill, is to amend the Principal Act to provide for guarantees by the Cabinet Secretary for loans advanced to Micros, small, medium enterprises.
There was a motion on the alteration of the calendar of the house communicating that, pursuant to the provisions of Standing Order 28(4), and taking cognizance of the recent rise in the spread of COVID-19 pandemic in the Country, the House resolved to further alter its Calendar for the Fourth Session (Regular Sessions – 2020), as it had been amended on June 2, 2020 and therefore ordered with respect to the Sittings of the House during the period July 30 to August 13, 2020 – that, the House would hold morning and afternoon Sittings on Thursday, July 30, 2020, commencing at 10.00 a.m. and at 2.30p.m. respectively, thereafter, the rest of Sittings of the House of Tuesdays and Thursdays shall stand suspended; and that with effect from Wednesday, August 5, 2020, the House would hold its Sittings on Wednesdays only (Morning and Afternoon), commencing at 10.00 a.m. and at 2.30 p.m. respectively.
On Thursday 30th July, 2020:
The Committee of the whole considered the Public Finance Management (amendment) (no.2) Bill (National Assembly Bill no. 23 of 2020) and the Chairperson of the Departmental Committee on Finance and National Planning was tasked to considerthe discussed amendments to the Public Finance Management (Amendment) (No.2) Bill, 2020 (National Assembly Bill No. 23) at the Committee Stage.
The next sitting will be on Wednesday August 5, 2020 at 2:30p.m.
The Senate:
The Senate held 3 sittings during the stipulated period.
A special sitting was done on Thursday 23rd July 2020(morning and afternoon) to consider the motion by the Chairperson, Standing Committee on Finance and Budget seeking approval of the third basis for revenue allocation among the county governments.
Objective of the third basis revenue allocation |
Indicator for expenditure need |
CRA Formulae % |
Senate Committee Formulae % |
Proposed Sakaja formulae % |
To enhance service delivery |
Health Index |
17 |
20 |
17 |
Agriculture Index |
10 |
12 |
10 |
Population Index |
18 |
16 |
18 |
Urban Index |
5 |
4 |
5 |
Basic Share Index |
20 |
20 |
20 |
To promote balanced development |
Land Area index |
8 |
5 |
8 |
Rural Access index |
4 |
4 |
6 |
Poverty head count index |
14 |
15 |
14 |
To incentivize Fiscal Effort |
Fiscal Effort index |
2 |
2 |
1 |
To incentivize Fiscal Prudence |
Fiscal Prudence index |
2 |
2 |
1 |
Due to lack of consensus in the house there was an amendment from the majority whip to postpone the effective date of the third basis formula to the 2022/2023 financial year.Senators voted 25 to 22 against the amendment proposed.
Contention of such an arrangement would have been the conflict it could have caused with the provisions of the constitution which under the 6th Schedule stipulates that, the first and second determinations of the basis of the division of revenue among the counties shall be made at three year intervals and subsequent formulae shall be applicable after five years.Deferring the application of the third basis of revenue allocation would therefore mean that relevant constitutional provisions be amended to avoid any possible litigations.
Having not reached a consensus on the proposed formulae, Nairobi Senator proposed an alternative amendment to the third basis of revenue allocation formulae whereby it proposes to use both second and third basis together.He said the total equitable share of a county should be equal to allocation per county for the financial year 2019-2020 plus the equitable share over and above Sh316.5 billion. This way, he amends the CRA formulae by reducing percentage of Fiscal effort and Fiscal prudence to 1% each and adding the 2% to roads percentage making it 6%.Deputy Speaker Prof. Margaret Kamar made a ruling on the issue of time, stating that Hon. Sakaja’s amendment would have to be given the same time for debate as was given to Hon. Kangata’s rejected amendment.
She announced the adjournment of the house until Tuesday, August 4, 2020 at 2:30 p.m.