We saw at the beginning of this discussion on the Revenue Fund that the Controller of Budget COB, must approve every withdrawal from the Fund. Actually, it is the same Controller who also gives the green light for the transfer of devolution monies from the National Funds (mentioned in Articles 204, 206 and 207) into the County (Revenue) Funds. Part 6 - Financial Officers and Institutions:
228. (4) The Controller of Budget shall oversee the implementation of the budgets of the ....... county governments by authorising withdrawals from public funds under Articles 204, 206 and 207.
(5) The Controller shall not approve any withdrawal from a public fund unless satisfied that the withdrawal is authorised by law.
In a bid to streamline the management of devolved funds, the Transition Authority, the body mandated to midwife devolution of functions and therefore, funds, to the Counties, announced on the 3rd of September 2013 that Governors will only be allowed to make one withdrawal each month from the County Revenue Fund, ostensibly to control spending and end the misuse of those funds. This measure would also allow the Authority and the Office of the COB to keep pace with the money trails at the Counties, so the two are not seen to appear to shut the stable (Revenue Fund) door only after the horse has bolted. This is important because by that time, none of the Counties had fully integrated the Treasury's IFMIS into their accounting and financial operations.
The COB is also required to keep tabs on how the withdrawals are being used and by whom, and issue tri-annual reports:
(6) Every four months, the Controller shall submit to each House of Parliament a report on the implementation of the budgets of the national and county governments.
Thus all Counties must, as required by legislation, put in place proper controls and open reporting systems in the management and use of the money from the Revenue Fund.
225. (2) Parliament shall enact legislation to ensure both expenditure control and transparency in all governments and establish mechanisms to ensure their implementation.
190. (2) County governments shall operate financial management systems that comply with any requirements prescribed by national legislation.
The COB's reports in sub-article 228. (6) above may very well form the basis on which a rogue County government finds itself in trouble with the rest of the country, resulting in its 'take-over' by the National government:
(3) Parliament shall, by legislation, provide for intervention by the national government if a county government— (b) does not operate a financial management system that complies with the requirements prescribed by national legislation.
(4) Legislation under clause (3) may, in particular, authorise the national government — (a) to take appropriate steps to ensure that the county ....... operates a financial management system that complies with the prescribed requirements; and (b) if necessary, to assume responsibility for the relevant functions.
Or worse still, the rogue County may face a possible denial of funds by the National Executive:
225. (3) Legislation under clause (2) may authorise the Cabinet Secretary responsible for finance to stop the transfer of funds to a State organ or any other public entity— (a) only for a serious material breach or persistent material breaches of the measures established under that legislation; ........
The gist of sub-article 190 (3) clearly lends credence to the need and relevance of a restructured and modern, professional Provincial Administration, PA able to quickly deploy and take over the function(s) of a County government that is not keeping up or one which is not playing by the rules. (NB. The PA is discussed further under the Provincial Administration link.)
And at the end of every financial year, prompt audit reporting by the Auditor-General is made on the financials of the Counties (including County organs and bureaucracies) and County Funds:
229. (4) Within six months after the end of each financial year, the Auditor-General shall audit and report, in respect of that financial year, on— (a) the accounts of the ....... county governments; (b) the accounts of all funds and authorities of the ....... county governments;
A damning report from the Auditor-General against a County government can also lead to the application of the interventions provided under clauses (3) and (4) of Article 190.
The Constitution appears to set a very strict framework in the administration of County Finance. It is hoped that this will minimise corruption, waste and inefficiency at the regions as well as to keep the public well informed about how money is being spent in their respective Counties.