(4) An authorisation given under subsection (3) remains in force for such period as is specified in it or, if no such period is specified, until it is revoked by the County Treasury concerned. (5) A County Treasury may, in writing, revoke or vary an authorisation given under subsection (3). Secondment of public officers by a County Treasury to the National Treasury. 106. (1) A County Treasury may, upon the request of the National Treasury, second to the National Treasury such number of officers as may be necessary for the National Treasury to better carry out its responsibilities under this Act.

(2) A public officer seconded to the National Treasury under subsection (1), shall be deemed to be an officer of the National Treasury and shall be subject only to the direction and control of the National Treasury. The Public Finance Management Act, 2012 113 County Treasury to enforce fiscal responsibility principles. 107. (1) A County Treasury shall manage its public finances in accordance with the principles of fiscal responsibility set out in subsection (2), and shall not exceed the limits stated in the regulations. (2) In managing the county government’s public finances, the County Treasury shall enforce the following fiscal responsibility principles- (a) the county government’s recurrent expenditure shall not exceed the county government’s total revenue; (b) over the medium term a minimum of thirty percent of the county government’s budget shall be allocated to the development expenditure; (c) the county government’s expenditure on wages and benefits for its public officers shall not exceed a percentage of the county government’s total revenue as prescribed by the County Executive member for finance in regulations and approved by the County Assembly; (d)over the medium term, the government’s borrowings shall be used only for the purpose of financing development expenditure and not for recurrent expenditure; (e) the county debt shall be maintained at a sustainable level as approved by county assembly; (f) the fiscal risks shall be managed prudently; and (g) a reasonable degree of predictability with respect to the level of tax rates and tax bases shall be maintained, taking into account any tax reforms that may be made in the future.

(3) For the purposes of subsection (2) (d), short term borrowing shall be restricted to management of cash flows and shall not exceed five percent of the most recent audited county government revenue. The Public Finance Management Act, 2012 114 (4) Every county government shall ensure that its level of debt at any particular time does not exceed a percentage of its annual revenue specified in respect of each financial year by a resolution of the county assembly. (5) The regulations may add to the list of fiscal responsibility principles set out in subsection (2). County government deviation from financial objectives.

108. (1) A county government may, with the approval of its county assembly, deviate from the financial objectives in the relevant County Fiscal Strategy Paper , but only on a temporary basis and only if the deviation is required because of a major natural disaster or some other significant unforeseen event. (2) If there is a change of county government, the new county government may deviate from the financial objectives in a County Fiscal Strategy Paper, but may not deviate from the fiscal responsibility objectives.

(3) The County Treasury shall also provide a report to the county assembly regarding the deviation and its implication and shall include in the report — (a) information on the reasons and implication for the deviation; (b) proposals to address the deviation; (c) the time the deviation is estimated to last; and (d) the status of development projects initiated by the county government and if any projects have been stopped, the reasons for doing so. (4) The County Treasury shall publish and publicise the report not later than fifteen days after it has been submitted to the county assembly. The Public Finance Management Act, 2012 115 Responsibilities of a county treasury with respect to county public funds Establishment of a County Revenue Fund for each county government.

109. (1) There is established, for each county a County Revenue Fund in accordance with Article 207 of the Constitution. (2) The County Treasury for each county government shall ensure that all money raised or received by or on behalf of the county government is paid into the County Revenue Fund, except money that— (a) is excluded from payment into that Fund because of a provision of this Act or another Act of Parliament, and is payable into another county public fund established for a specific purpose; (b) may, in accordance with other legislation, this Act or County legislation, be retained by the county government entity which received it for the purposes of defraying its expenses; or (c) is reasonably excluded by an Act of Parliament as provided in Article 207 of the Constitution.

(3) The County Treasury shall administer the County Revenue Fund and ensure that the county government complies with the provisions of Article 207 of the Constitution. (4) The County Treasury shall— (a) arrange for the County Revenue Fund to be kept in the Central Bank of Kenya or a bank approved by the County Executive Committee member responsible for finance and shall be kept in an account to be known as the “County Exchequer Account; and (b) ensure that all money authorised to be paid by the county government or any of its entities for a public purpose is paid from that account without undue delay.

(5) The County Treasury shall ensure that at no time is the County Exchequer Account overdrawn. (6) The County Treasury shall obtain the written approval of the Controller of Budget before withdrawing The Public Finance Management Act, 2012 116 money from the County Revenue Fund under the authority of— (a) an Act of the county assembly that appropriates money for a public purpose; (b) an Act of Parliament or county legislation that imposes a charge on that Fund; or (c) this Act in accordance with sections 134 and 135.

(7) The approval of the Controller of Budget to withdraw money from the County Revenue Fund, together with written instructions from the County Treasury requesting for the withdrawal, is sufficient authority for the approved bank where the County Exchequer Account is held to pay amounts from this account in accordance with the approval and the instructions. (8) Any unutilised balances in the County Revenue Fund shall not lapse at the end of the financial year but shall be retained for the purposes for which it was established.

(9) Financial reports shall be submitted to the Commission on Revenue Allocation with a copy to the Controller of Budget. County Government Executive Committee may establish county government Emergency Fund. 110. (1) A County Executive Committee may, with the approval of the county assembly, establish an emergency fund for the county government under the name “................County Emergency Fund” and the fund shall consist of money from time to time appropriated by the county assembly to the Fund by an appropriation law. (2) The purpose of an Emergency Fund is to enable payments to be made in respect of a county when an urgent and unforeseen need for expenditure for which there is no specific legislative authority arises. County Executive Committee member for finance to administer the Emergency Fund.