The government has stuck to its guns and affirmed that it won't give more than the Sh380 billion it has offered counties as shareable revenue.

The Council of Governors and the national government are deadlocked over the allocation of shareable revenue in the 2023/24 financial year after a consultative meeting held on Wednesday failed to reach a consensus.

Governors are asking for Sh425 billion but the national government is stuck at Sh380 billion, being 14.8 per cent of the projected total revenue collection of Sh2.9 trillion.

Deputy President Rigathi Gachagua on Thursday said the government will not cede ground on that stance saying there is no money.

"The issue we had with the council of governors is a simple matter, they are asking for 425. CRA is saying in our scheme of mathematics you can give 407. The national government is saying 425 is good, we can give it you but we don't have it. 407 is even better, but we don't have it, we only have 380," Gachagua said.

"So, if you want to hang us, we are helpless. If you want to remove our trousers and whip our backs, go ahead. We don't have the money," the DP added.

He spoke at the close of the four-day post-election seminar for senators in Mombasa.

On Wednesday, Gachagua chaired the Intergovernmental Budget and Economic Council (IBEC) meeting with CoG over to deliberate on the shareable revenue formula but failed to reach a deal with CoG.

CoG chair Anne Waiguru said in a brief after the meeting that the national government expressed willingness to compromise and give Sh385 billion.

She said the Commission on Revenue Allocation (CRA) recommended that counties be allocated Sh407 billion based on counties' priorities and devolved functions. 

The Constitution pegs the equitable revenue to be allocated to counties as 15 per cent of the latest audited revenues.

Gachagua, however, insisted that the Kenya Kwanza government is honest and will not go into the business of lying to governors that they will get what they are asking for.

"What we don't want to do is to cheat governors that we will give them money that we don't have. They were promised Sh50 billion, but it never came."

The DP said already as it stands, the government is having trouble with meeting the monthly disbursements to counties such that they have fallen three months behind on arrears.

"So we are asking them if what was in the budget Sh370 billion we have been unable to give you, if we give you Sh425 billion, it will just be a lie."

In the 2021/2022 Financial Year, county governments received Sh340.4 billion as their equitable share of revenue raised nationally.

The amount was equivalent to Sh370 billion in appropriations as per the County Allocation of Revenue Act (CARA) 2021.

"We swore with the Bible before God and the people of Kenya to always speak the truth. We have no 425 to give to the governors, we don't have 407, we will try to look for 385, we will try, we are not promising," Gachagua said.

He said the government has scheduled summit and informal meetings with Governors from next week so as to discuss how to complete the unbundling of county functions.

Gachagua said the Senate and his office should work more closely to ensure counties and devolution work.