Deputy President William Ruto has told counties that the national government can only share revenue it has raised.
Mr Ruto said the country cannot share resources beyond its capacity.
"We should share real money. We cannot share what we do not have,” he said during a meeting of the Intergovernmental Budget and Economic Council (IBEC) held at his Karen office, Nairobi Tuesday.
Reluctant to borrow
“We cannot tell the people that we are borrowing. I must say that we are reluctant to continue borrowing monies.”
Mr Ruto said the huge appetite for funds by county governments will burden the country with debt.
The Deputy President was responding to demands by county governments that they should be given allocation to the tune of 42 percent of the country’s revenue.
The National Treasury has proposed a 31 percent share of the total shareable revenue, while the
Commission on Revenue Allocation has proposed 35 percent.
Mr Ruto said the government was working on an austerity programme.
Live within our means
“We should not allow our country to sink because of borrowing. We should live within our means,” said Mr Ruto.
The Deputy President said since there was a difference between proposals by the CRA and the Treasury, the matter would be referred to Parliament for resolution.
“I am confident that they will put into consideration suggestions from this forum and reach consensus on how to share revenue,” he said.
"I urge for patience as we wait for Parliament to resolve this matter.”
The chairman of the Council of Governors Peter Munya said county governments were willing to accept a 35 percent increase.