NAIROBI, Kenya, Oct 13 – The planned transition of thousands of Universal Health Coverage (UHC) workers to permanent and pensionable terms has triggered a fresh debate over how their salaries will be financed, with MPs demanding a predictable funding framework to prevent payment delays and mounting county arrears.
The National Assembly Budget and Appropriations Committee has called for clarity on how the workers’ remuneration will be funded as the Commission on Revenue Allocation (CRA) prepares recommendations on revenue sharing between the national and county governments for the 2027/28 financial year.
Committee chairman Samuel Atandi said county allocations must reflect the actual cost of devolved functions, the country’s revenue outlook and competing expenditure demands facing the two levels of government.
Speaking during a consultative meeting with the commission in Nairobi on Tuesday, Atandi warned that unpredictable disbursements could undermine county governments’ ability to meet their financial obligations and deliver essential services.
“We must also address the effectiveness and predictability of transfers to county governments. Timely and predictable disbursements are essential to enable counties to plan, meet their obligations and deliver services without accumulating arrears,” he said.
The funding question follows plans by the Ministry of Health and the Council of Governors to transition UHC workers to permanent and pensionable terms, with their remuneration aligned to rates prescribed by the Salaries and Remuneration Commission (SRC).
According to the CRA, the Ministry of Health recruited 9,724 UHC personnel through the Public Service Commission in 2020 for an initial three-year period. Of these, 8,550 were deployed to the 47 counties, although their salaries have continued to be processed by the national government through the Ministry of Health.
Moving the workers to permanent and pensionable terms has raised questions about whether their salaries should remain a national government responsibility or be incorporated into county budgets through the equitable share of revenue.
The CRA says incorporating the wage bill into counties’ equitable allocations would require a review of the existing formula used to distribute revenue among the 47 devolved units.
CRA chairperson Mary Chebukati said the commission was seeking Parliament’s guidance on whether the formula could realistically be reviewed before April 2027, citing the extensive consultations required to reach agreement on changes to the revenue-sharing framework.
Pending that review, the commission proposed that the workers’ salaries continue to be financed through conditional allocations from the national government to county administrations.
The proposal would maintain a separate funding arrangement for the workers rather than immediately transferring the salary burden to counties through changes to their equitable share.
Atandi also challenged the commission to explain the assumptions informing its proposed allocations, including how inflation, county expenditure needs and existing service delivery responsibilities had been factored into the recommendations.
He noted that although the national government faces substantial debt-servicing obligations and other national expenditure commitments, counties remain responsible for critical services such as healthcare, agriculture, water and local infrastructure.
The committee’s concerns reflect the broader challenge of balancing national fiscal pressures with the need to ensure that devolved governments receive adequate and reliable resources to perform their constitutional functions.
CRA Commissioner Fatuma Gedi said the early consultations were intended to resolve outstanding issues and build consensus before the commission submits its formal revenue-sharing recommendations for the 2027/28 budget cycle.
“One of the legacies we would like to leave is a revenue-sharing recommendation that does not end up in mediation,” she said.
The commission plans to submit its recommendations ahead of the next budget cycle, with the proposed funding arrangement for UHC workers emerging as one of the key issues requiring resolution.
The outcome will determine how the workers’ salaries are financed during the transition to permanent and pensionable employment, while also shaping the resources available to counties for other essential services.