The National Treasury has promised to release funds owed to counties by the end of this month even as a Senate team summoned Cabinet Secretary Ukur Yatani to appear before it next Tuesday to explain the cash hold-up.
The Council of Governors' finance committee, chaired by Mr Nderitu Muriithi (Laikipia), met with Treasury officials where Mr Yatani promised to release the arrears by the end of May.
With less than three months to the end of the financial year, Treasury is yet to disburse more than Sh66 billion to counties in both equitable share and conditional grants.
Of this figure, Treasury is yet to disburse Sh4 billion for the Linda Mama Programme, Nairobi County is owed Sh2.6 billion for December, while all the counties are owed Sh12 billion for February and Sh25 billion for March.
Yesterday, Mr Muriithi said talks are ongoing between the CoG and the Treasury over the delays.
"Treasury has committed to clearing the debts by the end of this month," Mr Muriithi said after Wednesday's meeting.
According to the governor, one county is yet to receive its January disbursement of equitable share, another 17 counties have not got their share for February while no county has received money for March and April.
Mr Muriithi urged the Treasury to develop innovative ways of disbursing the funds, warning that further delays would slow down economic activity.
"A slowdown in economic activity affects tax collection. Companies are not able to receive payments for the goods and services procurement by the counties and are not, therefore, able to honour their tax obligations," he told Nation yesterday.
He said it would be realistic for the Treasury to borrow from the local market and distribute the money among counties to avoid an economic shutdown.
The Senate Finance and Budget Committee, on the other hand, will meet the Treasury mandarins on Tuesday to discuss the outstanding balances in the disbursement of equitable shareable revenues for counties in the 2021/22 financial year.
The CoG has constantly questioned the delays and pleaded with the Treasury to speed up disbursements to facilitate normal operations in the counties and allow them to settle their pending bills.
Senate Minority Whip Mutula Kilonzo Junior said the committee had summoned Mr Yatani to shed more light on the issue as part of the lawmakers' consideration of the County Allocation of Revenue Bill, 2021 that is currently before the House.
"We want to establish the reasons for the delays and why the figure is huge," Mr Kilonzo Jr told Nation yesterday.
The Bill, which allocates Sh370 billion to counties in the next financial year, was introduced in the House last week and committed to the committee for consideration.