The Public Finance Management (Amendment) (No. 3) Bill, 2024
Status Timeline
Proposed
Active now
Public Review
Pending
Debate
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Executive
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Final
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Determining Costs and Funding Transferred Functions
Establishes that transferred functions must continue to be funded from previous sources. Any additional funding needs must be mutually agreed upon, funded by the transferring level of government, and based strictly on the costing frameworks in national and county budget manuals.
Mandatory Management of Transferred Assets and Liabilities
Requires all intergovernmental transfer agreements to include clear provisions for the acquisition, disposal, and transfer of assets and liabilities. The receiving level of government must keep an updated register and ensure these assets are returned to the transferring government upon expiry of the transfer period.
Strict 15-Day Cash Flow Publication Window
Obligates the transferring level of government to prepare and publicize cash flow projections based on various revenue sources within fifteen (15) days of the transfer period's commencement.
Comprehensive Reporting to Oversight Bodies
Mandates accounting officers of the receiving government to prepare and submit quarterly and annual financial and non-financial reports. Copies must be submitted to the Controller of Budget, the County Treasury, the Senate, the National Assembly, the Auditor General, and the respective county assembly.
Bill No.
No. 44 of 2024
Gazette No.
Supplement No. 189 of 2024
Sponsor
Kimani Ichung'wah
Background
Under Article 187 of the Constitution of Kenya, public functions and powers can be transferred between the national and county levels of government. The Public Finance Management (Amendment) (No. 3) Bill, 2024, introduces structured financial guidelines to govern these transfers, ensuring accountability, proper costing, and the orderly handback of assets and liabilities.
Key Amendments
Insertion of Part IVA into Cap. 412A (Sections 186A–186G)
This amendment inserts a dedicated intergovernmental financial framework that applies to all transfers under Article 187 of the Constitution and sections 24 to 28 of the Intergovernmental Relations Act.
- Funding Continuity (Section 186C): Transferred functions continue to be funded from their original sources unless additional resources are required, which must be mutually agreed upon and provided by the transferring level of government.
- Costing Framework (Section 186D): The cost of transferred functions must be calculated based on the national and county government budget manuals. These costs must form separate schedules in the budget estimates submitted to Parliament or the county assemblies, clearly detailing allocations, appropriations-in-aid, loans, and grants.
New Obligations
Asset and Liability Registries (Section 186E)
- Receiving governments must establish, maintain, and update a register of all assets acquired and liabilities incurred during the transfer period.
- Receiving entities must take appropriate measures to ensure that assets and liabilities are returned to the transferring level of government upon the expiry of the transfer agreement.
Financial Projections and Publications (Section 186F)
- Transferring governments must prepare cash flow projections based on revenue forecasts.
- These projections must be published and publicized within 15 days of the start of the transfer.
Reporting and Accountability (Section 186G)
- Accounting officers managing transferred functions are required to prepare both quarterly and annual financial and non-financial reports.
- These reports must be shared with the Controller of Budget, the County Treasury, the responsible national government entity, the Senate, the National Assembly, the Auditor General, and the respective county assembly.
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