The impending crisis has been caused by the Senate’s lack of commitment to have the third basis formula approved in time after the expiry of the second basis formula that has been in place for the last three years. Without the third basis formula, the billions can’t be shared among the 47 devolved units from July 1, as it will be unconstitutional. The Constitution provides that the formula must be approved first before the County Allocation of Revenue Bill 2020 is considered. The second basis formula was passed on July 6, 2016, to serve for three financial years- 2017/18, 2018/19 with the 2019/20, the current financial year, being the last. The second basis formula saw a reduction on the basis for poverty index from 20 per cent to 18 per cent.

Source: Daily Nation June 16, 2020 06:56 UTC