Kenya's senate breaks deadlock on revenue-sharing, averts shutdown of services

By Duncan Miriri

NAIROBI (Reuters) - Kenyan senators broke on Thursday a months-long stalemate over a new scheme for sharing of funds among county governments, paving the way for resumption of crucial services like patient admissions.

The governors of the East African nation's 47 counties on Wednesday said they would start shutting down services due to the deadlock, which has led to them being starved of cash from the national government.

The deal to break the stand-off was arrived at after a special committee of 12 senators unanimously agreed a way forward.

The wider senate adopted the committee's report through a resolution, paving the way for the new scheme to kick in and for Nairobi to dispatch funds to the county governments.

All 41 senators present voted for the resolution.

The initial proposed scheme had sharply divided opinion, with critics saying it took funds away from less-populated, poor regions and handed them to those that are economically stronger.

Supporters said it would ensure a more equitable distribution of the cash. Counties are entitled to 15% of annual national revenue according to the constitution, which also requires the sharing formula to be reviewed routinely.

The new scheme passed by the senate on Thursday guarantees that no county will lose its annual funds allocation, Senator Moses Wetangula, a member of the special committee, told the house.

Counties will get an extra allocation of 53.5 billion shillings (381.38 million pounds), Wetangula said.

Established by a new constitution in 2010 to try and spread national wealth to more people in the grassroots, the county governments have opened a new front in the East African nation's fractious politics.

(Editing by Lisa Shumaker)