The Equalisation Fund (Administration) Bill (Senate Bill No. 14 of 2023)-1

REPUBLICOFKENYA

PARLIAMENT

SENATEBILLS

(Bill No. 14 of 2023)

THEEQUALISATIONFUND(ADMINISTRATION) BILL, 2023

(A Bill published in theKenya GaxetteSupplement No.44of12April,2023and passed by the Senate,with amendments,on12hOctober2023.)

Clauses

PARTI-PRELIMINARIES

• 1-Short title and commencement.
• 2-Interpretation.
• 3-Purpose.
• 4-Source of theFund.
• 5-Object of theFund.

PARTIII-ESTABLISHMENTOFADVISORYBOARD

• 6-Establishment of EqualisationFundAdvisoryBoard.
• 7-Qualificationsfor appointment to theBoard.
• 8-Vacation of office.
• 9-Functions of the Board.
• 10-Decisions ofthe Cabinet Secretary.
• 11-CommitteesoftheBoard.
• 12-Expenses of theBoard.
• 13-Officer administering theFund.
• 14-Conduct of affairs oftheBoard.
• 15-Secretariat.

PARTIV-COUNTYTECHNICALCOMMITTEES

• 16-Projects and programmes for financing under theFund.
• 17-Establishmentofcountytechnical committees.

2

THEEQUALISATIONFUND(ADMINISTRATION)BILL2023 ARRANGEMENTOFCLAUSES

PARTII-THEEQUALISATIONFUND

• 18-Functionsofthe countytechnicalcommittee
• 19-Sub-countytechnicalcommittee.
• 20-Functionsofthesub-countytechnical committee.
• 21-ProjectIdentification andImplementationCommittee.
• 22-FunctionsofProjectIdentificationandImplementationCommittee.
• 23-Functions of the countyexecutive committeemember.
• 24-Approval ofworkplan.
• 25-Preparation of workplans.
• 26-Submissionofworkplan to theAdvisoryBoard.
• 27-Quarterly reports on projects and disbursements.
• 28-Reportby thecountyexecutivecommitteemember.
• 29-Withdrawalsfrom theFund
• 30-Audit.

PARTV-WINDINGUPOFTHEFUND

• 31-Reportsto theAdvisoryBoard.
• 32-Suspension underArticle204(8).

PARTVI-REPEALS,SAVINGSANDTRANSITIONS

• 33Interpretation of part.
• 34-Repealof LegalNoticeNo.54of2021.
• 35-Transitionalprovisions.
• 36 - On-going projects.
• 37-Members of theAdvisoryBoard.
• 38-StaffoftheAdvisoryBoard

Short titleand commencement.

Interpretation.

THEEQUALISATIONFUND(ADMINISTRATION)BILL,2023

ABillfor

ANACTof Parliamenttoprovideforthe administrativestructures for the management of theEqualisationFund;to establish an AdvisoryBoard;and forconnectedpurposes.

ENACTEDbytheParliamentofKenya,asfollows

PARTI-PRELIMINARIES

1.This Act may be referred to as the Equalisation Fund (Administration) Act, 2023 and shall be deemed to have come into effectimmediatelyuponassent.

2.In this Act-

"Accounting Standard Board"has the meaning assigned to it undersection2ofthePublicFinanceManagementAct;

"Board"means theEqualizationFundAdvisoryBoardestablished under section 6;

"Cabinet Secretary"means the Cabinet Secretaryresponsible for matters relating toFinance;

"county executive committee member"means the county executive committeememberresponsibleforfinance;

"county governments""means the County Governments in which marginalized areas identified by the Commission onRevenueAllocation existforpurposesofArticle204(2)oftheConstitution;

"eligible county"means a county government identified as a beneficiaryoftheFundbytheCommissiononRevenueAllocationin accordancewithArticle216(4)oftheConstitution;

"First Policy"means thefirst policydetermined bythe Commission on Revenue Allocation under Article 216(4) of the Constitution in identifyingmarginalized areas for purposes ofArticle 204(2)oftheConstitution;

"Fund" means the Equalization Fund established under Article 204oftheConstitution;

Purpose.

"fund administrator"means the person appointed under section 14;

"marginalized area"means an area identified under policy determinedby the CommissiononRevenueAllocationinaccordance withArticle216(4)oftheConstitution.

"revenue"means the total revenue collected by the National Governmentincludingordinaryrevenue andAppropriations-in-Aid.

"Second Policy"means the Second Policy determined by the Commissionon Revenue Allocation under Article 216(4)of the Constitution in identifying marginalized areas for purposes of Article 204(2)oftheConstitution;and

"unutilized balance"means-

• (a)amountsnotwithdrawnfrom theFundat theendof financial year;and
• (b) any amountwithdrawn from theFundforpurposes of provision of basic services under an Appropriations Actandnotexpendedattheendoffinancialyear;
• (c)amountearmarkedfortheFirstPolicywithfourteen Counties ongoing projects; and
• (d)amountearmarkedfor theSecondPolicywith34 Counties (New projects to beidentified).

3.Thepurposeof thisAct isto-

• (a)provide aframeworkfor administration andmanagement of theEqualizationFundin accordancewithArticle204 ofthe Constitution;
• (b)provide for completion of projects under policies developed by the Commission onRevenue Allocation underArticle216(4)oftheConstitution;
• ()provideaframeworkfor theidentification,selection and implementation ofprojectsforpurposes of theFund;
• (d)suspendtheapplicationofArticle204(7)of the Constitution and extend the pendency of theFund;and
• (e)providefor the procedures inrelation towinding up of the Fund..

Sourceofthe Fund.

Objectof the Fund.

Establishmentof EqualisationFund AdvisoryBoard.

PARTII-THEEQUALISATIONFUND

• 4.The Fund shall,pursuant toArticle 204(1) of the Constitution, consistofonehalfofallrevenuecollectedbythenationalgovernment eachyearcalculatedon thebasisof themostrecentaudited accountsof revenuereceived,as approved by theNational Assembly.
• 5.Theobjectof theFund istoprovidebasic servicesincluding water,roads,healthfacilitiesandelectricitytothemarginalized areasto theextentnecessarytobring thequalityof thoseservicesto thelevel generally enjoyed by therestof thenation,so faraspossiblein an equitable,efficientandtransparentmanner.

PARTIII-ESTABLISHMENTOFADVISORYBOARD

• 6.(l)There is establisheda Board to be known as the EqualisationFundAdvisoryBoardwhich shall consistof
• (a) the Chairpersonwho shall be appointed by the Cabinet Secretary;
• (b)thePrincipalSecretaryresponsibleformattersrelatingto finance;
• (c)thePrincipalSecretaryresponsibleformattersrelatingto devolutionorarepresentativedesignatedinwriting;
• (d)onepersonfromapastoralistcommunitynominatedby the National Assembly;
• (e)one person nominated by theSenate;
• (f)twopersonsnominated by theCouncilofGovernors drawn from areas identifiedasmarginalized by the Commission onRevenueAllocation;
• (g)the Chairperson of the Commission on Revenue Allocationorarepresentativedesignatedinwriting;
• (h)one person representing persons with disabilities appointedby the CabinetSecretary;
• (i) the Chief Executive Officer who shall be secretary of the Board.
• (2)A personnominatedunder section(1)(d),(e) and(f) shall be appointedby the CabinetSecretarybynotice in the Gazette.

• (3)Thepersons appointed under subsection(1)(d),(e),(f) and(h) shallholdofficefora termof threeyearsandshallbeeligiblefor reappointmentforonefurthertermofthreeyears.

Qualificationsfor 7.Aperson is qualified for appointment under section 6(1)(d), appointment to the (e)and(f) ifthatperson- Board.

• (a)is a citizen of Kenya;

• (b)holds a degree from a university recognized inKenya;

• (c)has atleastfiveyears'professional experience in thefield ofeconomics,banking,finance,law or any other field relevanttothefunctionsoftheBoard;and

• (d)meetstherequirementsof ChapterSixoftheConstitution.

Vacationofoffice. 8.A member of the Board appointed under section 6(1)(d),(e)

and (f) may-

• (a)resign from officebynotice in writing to theCabinet Secretary;

• (b)beremovedfromofficebytheCabinetSecretaryif the member-

• (i)hasbeen absentfrom threeconsecutivemeetingsof the Boardwithoutpermissionfrom theBoard;

• (i) is adjudged bankrupt or entersinto a composition or scheme of arrangement with his creditors;

• (ii)is convicted of an offense involving dishonesty or fraud;

• (iv)isconvictedofacriminaloffence andsentenced to imprisonmentforatermexceedingsixmonths;

• (v) is incapacitated by prolonged physical or mental illness;or

• (vi)is otherwise unfit or unable to discharge the functions ofthe office.

Functions of the Board.

9. (1)TheAdvisoryBoardshall—

• (a)advise and make recommendations to the Cabinet

Secretaryon thedistributionofresourcesfortheprovision of thebasicservices to themarginalisedareasunder Article 204of theConstitution inlinewith the recommendations of the Commission on Revenue Allocation;

• (b)appraise and evaluate projects proposed under the workplanssubmittedtotheAdvisoryBoardundersection 15toensure compliancewith theConstitution and the recommendationsissuedbytheCommissiononRevenue Allocation;
• (c)make recommendations on the priority areas requiring financing and implementation in accordance with the workplans considered under section (b)and inline with therecommendationsoftheCommissiononRevenue Allocation;
• (d)oversee,in consultation with the County Governments, theimplementationof theprojectstoensurecompliance with theConstitution;
• (e)monitor and evaluate the projects implemented by County Governmentstodetermine theirimpactin addressing the factors contributing to themarginalisationof theareas identifiedin the counties;
• put in place measures for transparency and accountability intheimplementationofprojectsbyCounty Governments;
• (g) establishaframeworkforcollaborationbetweenthe National GovernmentandCountyGovernmentsin the implementationofprojectsinlinewiththeConstitution, therecommendationsof theCommissiononRevenue Allocation and this Act;
• (h)reviewthe consolidatedquarterlyreportspreparedby the officeradministeringtheFundon theimplementationof theprojectsandmakerecommendations to theCabinet Secretaryonperformanceimprovement;
• ? review the annual estimates ofexpenditureoftheFund forapprovalbytheCabinetSecretary;
• undertakeprojectpublicparticipationin linewithArticle 201oftheConstitution;and

Decisions of the CabinetSecretary.

Committeesof the Board.

Expensesofthe Board.

Officer administeringthe Fund.

• (k)carry out such other functions thatmay be necessary for theachievementoftheobjectsandpurposesofthisActor thatmaybe conferred by any otherlaw.

10.(l)The Cabinet Secretary shall take into account the recommendationsoftheBoard

• (2)WhereCabinetSecretarydeviatesfrom therecommendations of theAdvisoryBoard,theCabinetSecretaryshallgivereasonsforthe deviationin writing.
• 11.TheAdvisoryBoardmay-
• (a)establish such committees asit considers necessaryfor the effectiveperformanceofitsfunctionsandexerciseofits powers under thisAct;
• (b)invite tositin a meetingof theBoard,such otherpersons whoseknowledgeandskillsarefoundnecessaryforthe effectiveperformanceoftheBoard;and
• delegatetoacommittee,theexerciseofanyofthepowers ortheperformanceofanyofthefunctionsoftheBoard underthisActoranyotherwrittenlaw.
• 12.(1)Subject to subsection (2), there shall be paid out of the Fund,expensesoftheAdvisoryBoard andsuchotherexpensesincurred pursuanttotheobjectandpurposeforwhichtheFundisestablished.
• (2)TheexpenditureincurredontheFundshallbeon thebasisof andlimitedto annualworkprogrammesandbudgetestimatesprepared by theAdministratorof theFundandapprovedby theAdvisoryBoard and theCabinetSecretary at thebeginningof thefinancialyear towhich they relate.
• (3)Theadministrative costsandexpensesof theAdvisoryBoard shallnotexceed threepercentof the approved annual allocation tothe Fund.
• (4) Subsection(3) shall come into force and be applicable with respecttothefinancialyearinwhich thisActcomesintoforce andshall not applywithrespect toprecedingfinancialyears.
• 13.(l)TheChiefExecutiveOfficeroftheBoard shallbe the administratorto theFundandshallbecompetitivelyrecruitedby the Board.

• (2)ApersonisqualifiedforappointmentasaChiefExecutive Officeriftheperson-
• (a)has at least a Master's degree from a university recognized in Kenya;
• (b) level in financial management, business administration, economicsorlaw;and
• (C) meetstherequirementsof ChapterSixofthe Constitution.
• (3)TheChiefExecutiveOfficer shall servefor a termof three yearsandshall beeligibleforre-appointmentforafurther andfinal term ofthreeyears.
• (4)TheofficeradministeringtheFundshall-
• (a)open a separate accountat the CentralBankofKenya intowhichallmoniesraisedunder section4shallbe paid into;
• (b)operate and maintain the bank account in (a) in a manner asprescribed by theNational Treasury from time to time;
• (c)consultwith CabinetSecretary and theAdvisoryBoard onmattersrelatingto theadministrationof theFund;
• (d)cause tobekeptproper booksof accounts andother books and records in relation to the Fund,of all activities and undertakingsfinancedfrom theFund;
• (e)prepare,sign and submit to the Auditor-General and Parliament,in respect of each financial and within three months after the end thereof,a statementof accountsrelatingtotheFundwithacopyto the Controller ofBudgetandthe statements shall be prepared in a manner prescribed by the Accounting Standards Board;
• (f).furnish additional information as theofficerconsiders tobe proper and sufficient for the purpose of examination and audit by theAuditor-General in accordancewith theprovisions of thePublicAuditAct; and

Conductofaffairs of theBoard.

Secretariat.

• g) prepare quarterly reports on the receipts into issues andwithdrawalsfrom theFundandsubmitittothe CabinetSecretaryforpublicationintheGazettebefore oronthetwentyfirstdayofeverythirdmonthofthe financial year.

2. 14.(1) The Board shall conduct its affairs in accordance with the Schedule. 3. (2)Except as provided in the Schedule,theBoardmay regulate its ownprocedure. 4. 15.(1) There shall be a secretariat consisting of- 5. (a) the officer administering theFund;and 6. (b) such otherpublicofficers asthe CabinetSecretary shall in consultationwith the AdvisoryBoard,designate for theproperperformanceof thefunctionsofthe secretariatunder thisAct. 7. (2)ThefunctionsoftheSecretariatshallbeto 8. (a)provide technical and administrative services to the AdvisoryBoard; 9. (b) implement the decisions,strategies andworkplanofthe AdvisoryBoard; 10. makerecommendationsto the AdvisoryBoard on the formulationandimplementationofprogrammesforthe carryingoutofthefunctionsoftheBoard; 11. (d)reviewandconsolidate the work-plansreceivedunder theseGuidelinesforconsiderationbytheAdvisoryBoard; 12. e identify any challengesin theimplementation ofprojects andmakerecommendationstotheAdvisoryBoardonthe remedialmeasuresrequiredtobeundertaken; 13. ( maintainadatabasesettingoutinformation on- 14. (iprojects,operations andprogrammesundertaken with respectto each County Government inmarginalised areashave been identifiedby the Commission on Revenue Allocation;

Projects and programmesfor financingunder theFund.

Establishmentof countytechnical committes.

• (ii)monies appropriated from theFund withrespect to each project or programme;and
• (ii)statusofeachprojectorprogrammeimplemented;
• g prepareandensure timelysubmissionofreportsto the AdvisoryBoardand the CabinetSecretaryregarding the implementationofprojectsandprogrammes under the Fund;
• (h)make arrangements for periodical evaluation of the criteria,standards and programmes in relation to the objects andfunctionsof theAdvisoryBoard;and
• perform suchotherfunctionsasmaybe assigned to it by theAdvisoryBoard.

PARTIV-COUNTYTECHNICALCOMMITEES

• 16.The Fund shall finance programmes or projects for the provision of the following basic services in areas identified as marignalised areasby the Commission onRevenueAllocation—
• (a)water and sanitation;
• (b) roads;
• (c)health facilities;
• (d) electricity;
• (e)such other basic services as shall be identified by the Commission on Revenue Allocation as requiring implementation in a marginalized area.
• 17.The Board shall,in every eligible county,establish and conveneacountytechnical committeecomprisingof-
• (a) the County Commissioner and the Governor who shall be cochairpersons;
• (b)therelevantcounty executivecommitteememberforFinance;
• (c)ConstituencyDevelopmentFundManagers;
• (d)a representative of the relevant CountyAssembly;and

Functions of the countytechnical committee.

Sub-county technical committee.

Functionsofthe sub-county technical committee.

to-

• (e)apublicofficeremployedintherespective countygovernment with technicalexpertisein areas that theprioritizedprojects fall.
• 18.The CountyTechnical Committeeshall beresponsiblefor approvingall projectstobefinancedfrom theFund.
• 19.The Board shall, in every eligible county, establish a subcountytechnical committee comprisingof-
• (a) the deputycounty commissioner and the sub-county administratorwhoshall beco-chairpersons;
• (b) notmore than twopublicofficers designatedbythecounty executivecommitteememberwith technicalexpertisein the areas oftheprioritizedprojects;
• (C) notmore than twopublicofficersappointed bytheCabinet Secretarywith technicalexpertisein the areasof the prioritizedprojects;
• (d) the chairpersons of the Project Identification and Implementation Committeeswithin thesub-county;and
• (e) the secretary of the ConstituencyDevelopmentFund.

20. Thefunctionsofthesub-countytechnicalcommitteeshall be

• (a) receive project funding proposals from respective Project Identification andImplementation Committees;
• (b) evaluate andprioritizeall developmentproposalsfrom the ProjectIdentificationandImplementation Committees;
• (c) access thefeasibility and cost allprojectproposals;
• (d) submitprojectproposals andfundingrequestsreceivedfrom theProjectIdentificationandImplementation Committees;
• (e) monitor all projects;
• preparequarterlyreportsonfundsreceivedand implementation statusfor submission to the county technical committee and thememberofthe county executive;and
• (g)prepare and submitto the county technicalcommitteeand the member of the county executive annual reports on

Project Identification and Implementation Committee.

Functions of Project Identification and Implementation Committee.

Functionsofthe countyexecutive comnittee member.

implementationofallprojects.

21.The Board shall,in every eligible county,establish a Project Identification andImplementation Committee comprisingof-

• (a) the Assistant Sub-County Commissioner who shall be the Chairperson;
• (b) thevillageadministratorsofareas defined bythe Commission asmarginalised;
• (c)arepresentativeofwomen,youth andpersonswithdisabilities from marginalised areas;
• (d)arepresentativeoffaith-basedgroups andnon-governmental organisations.

22.The functionsoftheProjectIdentification and ImplementationCommitteeshallbeto-

• (a)undertake public participation in beneficiary counties;
• (b)identify andprioritizeprojectinbeneficiaryareasinline withguidelinesissuedbythe administratoroftheFund;
• (c)prepare and submit project funding proposals to subcountytechnical committee;and
• (d)provideoversightonprojectimplementation.
• 23.(l) The county executive committee member in each eligible county shall-
• (a)consolidateallprojects approvedby thecounty technical committeeandsubmitto theSecretaryoftheBoardfor fundingwith copy to the Commission;
• (b)prepare financial statements for theFundforeachfinancial year in a form prescribed by theAccounting Standards BoardinaccordancewiththeActandsubmittothe SecretaryoftheBoard;
• (c)preparequarterlyfinancialreportsfor theFundinaform prescribedby theAccountingStandardsBoard andsubmit totheSecretaryoftheBoard;
• (d)preparequarterlyreportsonfundsreceivedand implementationstatusofallprojectsfinancedbytheFund withacopytotheSecretaryoftheBoard,theCommission

Approvalof workplan.

Preparationof workplans.

andtheControllerofBudget;and

• (e)prepare annual report on implementation of all projects financed by theFundwith a copy to theSecretaryof the Board,theCommissionandtheControllerofBudget.
• (2)Areport prepared under section (1)(e) shall include-
• (a)informationrelating to theprocurementof servicesandworks inrelation to the projects and programmes under the workplan;
• (b)a scheduleoftheworksrequired tobeundertakenandstatus oftheimplementationofprojectsandprogrammes;
• (c)the timelinesfor completion of specificphases of projects and programmes;
• (d) themannerinwhich thefundsreceivedfrom theFundhave been utilisedinrelation to anyprojectorprogramme;
• (e)themonies disbursed and anybalance ofunspentfunds;and
• (f)such otherinformation as theBoardmay require.
• 24.The CountyExecutive CommitteeMemberresponsible for mattersrelating tofinanceshall submitworkplans through therespective countytechnicalcommitteetotheBoardforapproval.
• 25.(1) The county executive committee member shall,upon the identification ofprojects andprogrammes under section24,prepare a workplansettingout-
• (a)a schedule ofprojects and programmes proposed to be undertakenby the countygovernment in the areas identified by theCommission;
• (b)a technical assessmentof theviabilityof theprojectsand programmes;
• (c)a report on thepublic participation undertaken during the process ofidentification ofprogrammes andprojects;
• (d)an assessment of the manner in which the programmes or projects would be expected to address the shortcomings identified by theCommissiononRevenueAllocationinthe

No.17of2012.

provisionof theidentifiedbasicneeds;

• (e)an assessmentofhow theprogrammesandprojects identified impact on the CountyIntegratedDevelopmentPlan;and
• (f)the approximatecostoftheworkstobeundertakeninrelation toaprojectorprogrammeidentifiedintheworkplan.
• (2)In identifying programis and projects for inclusion in the workplan,the countyexecutive committeemember shall —
• (a)takeinto account—
• (i) the criteria and other recommendationmade by the Commission on Revenue Allocation;
• (ii)thecostingof theprojectand the timerequired for the implementationoftheprojectonaprioritybasis;
• (i)recommendations,standards andguidelines issued by the AdvisoryBoard;
• (iv)theinterventionsrequired tobeundertaken onapriority basisinordertoaddresstheneedsidentifiedbythe CommissiononRevenueAllocationfor theprovisionof identifiedbasic services;and
• (v) therecommendationsof therespectiveMinistryorState Department;
• (b)undertake public participation using the structures established forcitizenparticipationunder section91of the County GovernmentsAct;and
• (c)collaboratewith therelevantMinistry orStateDepartment.
• (3)The county executive committeemember shall ensure that a workplan prepared under section (l) is aligned to the annual development plan of the county preparedunder the PublicFinance ManagementAct.
• (4)The relevant Ministry or State Department shallmakeits recommendations to theCountyExecutiveCommitteeMemberon the proposedworkplanwithinfourteendaysofreceiptofarequestunder subsection(2)(c)ofthisAct.
• 26.(1) The county executive committee shall,upon approval of

workplantothe AdvisoryBoard.

Quarterlyreports onprojectsand disbursements.

Reportbythe countyexecutive committee member.

aworkplan,submit theworkplantotheBoard.

• (2)Uponreceipt of theworkplan,theBoard shall-
• (a)appraise theworkplan to ensurecompliancewith thisAct;
• (b)ensure that the workplan adequately addresses the needs identified by the Commission onRevenueAllocation;
• ()identify the programmes or projects that require to be implemented on a priority basis;and
• (d)makeits recommendationsto the CabinetSecretary.
• 27.(1) The Board shall,on a quarterly basis, submit a report to the CabinetSecretarydetailing—
• (a)a summaryof theprojectandprogrammes approvedfor financing in the preceding year indicating the funding status of such projects,if any;
• )asummaryofthestatusofdisbursementsoffundstothe variousprojectsandimplementationprogress;
• (c)a summaryof thestatusofdisbursementsfrom theFund totherespectivecountygovernmentsoranyagency involvedinimplementationof anyprojectsfinancedfrom theFund;and
• (d)anyrestriction imposed on a county government or any agencyinvolvedin theimplementation of theprojects or programmes by the countygovernment.
• (2)A copy ofareport preparedunder subsection(1) shall be submittedto theCommissionand theControllerofBudget.
• 28.(1)Thecounty executivecommitteemembershall
• (a)prepare and submit to theAdvisorBoard quarterly reports on theimplementationof theprojectsorprogramsunder theworkplanin the formatprescribed bythe Advisory Board;and
• (b) ensure that any projects undertaken under the workplan are carriedoutinaccordancewith thePublicProcurement and AssetDisposal Actandany otherlaw.

Withdrawalsfrom theFund

Audit.

No.18of2012 No.34of2015

Reports to the AdvisoryBoard..

(3)TheofficeradministeringtheFundshall consolidate thereports submittedundersection(2)forconsiderationby theAdvisoryBoard and the CabinetSecretary.

• 29.(1) The administrator of the Fund shall open a designated EqualisationFundaccount attheCentralBankofKenya.
• (2)Whereawithdrawal from theFundis authorized underanAct ofParliament that approves the appropriation of money,theofficer administering theFundshall makearequisitionforthewithdrawaland submitit to theControllerofBudgetforauthorization.
• (3)TheauthorizationbytheControllerofBudgetofawithdrawal from the Fund,together with written instructions from the officer administering theFundrequesting for withdrawal,shall be sufficient authorityfor theCentralBankofKenya topayamountsfromthe EqualizationFundaccountinaccordancewith the authorizationand instructions given.
• (4)All withdrawals made from theFund under subsection (1) shall bedepositedinto therespectivespendingagencies account.
• (5)Anyunutilized balances in theEqualisation Fundshall not lapseattheendoftheFinancialyearbutshallberetainedforuseforthe purposeforwhichtheFundisestablished.
• 30.TheaccountsoftheFund shallbe audited andreported upon in accordance with thePublicFinanceManagementAct and thePublic AuditAct.

PARTV-WINDINGUPOFTHEFUND

• 31.(1)Atleasteighteen monthsbefore theexpiryof the term specifiedunderArticle 204(6)of the Constitution orinlegislation
• (a) the Advisory Board shall prepare a status report on all linewiththesubmittedworkplans;and
• (b)theCabinetSecretary shall-
• (i)make thenecessaryrequisitionforthe transferofmonies tothecountygovernmentsforthecompletionof the projects; and

Suspension under Article 204(8).

Interpretation of part.

• (ii)shallensure thatmoniesrequiredfor thecompletionof the projects has been transferred to therespective county governments.
• (2)At least twelve months before the expiry of the period specifiedunder Article204(6)of the Constitution or in legislation enactedbyParliamentpursuanttoArticle204(7)of theConstitution the county executive committee members in the respective county governmentsshall submit totheAdvisoryBoard-
• (a)a schedule of the programmes and projects implemented pursuant toArticle204of the Constitution and the expected completion date;
• (b)an assessment reportof theimpactof theprogrammes and projectsthathavebeenimplementedpursuanttoArticle204of the Constitution;and
• (c)a financial report on the projects and programmes.
• (3)TheAdvisoryBoardshallprepare thewindingupreportof Article204(6)oftheConstitutionorinlegislation enactedbyParliament pursuant toArticle 204(7)of theConstitutionforapproval by the CabinetSecretary.
• (4)The CabinetSecretary shall, submit the windingup report to theNationalAssemblyandtheSenatewithinfourteen daysof thereceipt of the report under section(3).
• 32.(1)Notwithstanding the provisionsof section 31,theperiod referred tounderArticle204(6) is suspended.
• (2)TheFundshallremaininforcefora furthernon-renewabletermof tenyearsfromthedateuponwhich theFundwouldhavelapsedunder Article 204(6).

PARTVI-REPEALS,SAVINGSANDTRANSITIONS 33.(1) In this part-

"Advisory Board"means the Advisory Board established under regulation 4(l) of the Public Finance Management (EqualizationFundAdministration)Regulations,2021;

"repealedRegulations'means thePublicFinanceManagement (EqualizationFundAdministration)Regulations,2021

Repeal of Legal NoticeNo.54of 2021.

Transitional provisions.

On-going projects.

Membersofthe AdvisoryBoard.

Staffofthe AdvisoryBoard

• (2)TheBoard shallbe thesuccessor to theAdvisoryBoard existingimmediatelybeforethecommencementofthisAct.
• 34.The Public Finance Management (Equalization Fund Administration)Regulations,2021,is repealed.
• 35.(l)Anyrights and obligationsofthe Advisory Board existing atthecommencementofthisActshall,byvirtueof thissubsection,vest intheBoardestablishedundersection6ofthisAct.
• (2)Anyreferencein any written law,document orinstrument to theAdvisoryBoardshall bedeemedtobeareferenceto theBoard.
• (3)Any rights andobligations vested in or enforceableby or against theAdvisoryBoardshall,byvirtueof this subsection,bevested inorbecomeenforceablebyor againsttheBoard.
• (4)Anyassetand liabilityheldorimposedontheAdvisoryBoard shall,byvirtueofthissubsectionvestintheBoard.
• 36.Any ongoing projects under the repealed Regulations shall be finalizedinaccordancewith theprovisionsofthisAct.
• 37.A person who was a member of the Advisory Board immediatelybeforethecommencementofthisActshall bedeemedtobe a memberof theBoardfor the unexpiredperiodof thatperson's tenure.
• 38.Apersonwhoimmediatelybeforethecommencementofthis ActwasanofficeroremployeeoftheAdvisoryBoardshallbedeemed tobeamemberofstaffoftheBoardfortheunexpiredperiodofthat person'stenure.

SCHEDULE

(s. 14)

PROVISIONSRELATINGTOMEETINGSOFTHEADVISORY BOARD

• 1.TheBoardshallmeetatleastonceineverythreemonths toconduct thebusinessof theBoardofAuthority.
• 2.Thechairpersonmay onhisorherown motion,or uponrequest bya member,calla specialmeetingof theBoardatany time,whereheor she considersitexpedientforthetransaction of thebusiness of theBoard.
• 3.Other than a special meeting,or unless three quarters of members

• agree,at leastfourteen days'writtennotice ofeverymeeting of theBoardof theAuthorityshallbegiventoeverymemberoftheBoardbythesecretary.
• 4.The quorum at a meetingof theBoard of theAuthority shall be half ofthemembers.
• 5.The chairperson shallpreside at themeetingsof theBoardof the Authority and in the absence of the chairperson,the vice-chairperson or a member of theBoardelectedby thememberspresent from among their numbershallpreside.
• 6.Themattersof theBoard shallbedecidedbyamajorityof the memberspresent andvoting andin theeventofequalityofvotes,theperson presidingshall havea castingvote.
• 7.The proceedings of the Boardof theAuthority shallnotbe invalidatedbyreasonofavacancyamongthemembersoradefectin the appointmentorqualificationofamember.
• 8.At the firstmeetingof theBoard, themembers shall electavicechairperson,notbeing anex-officiomember,from among itsmembers.
• 9.Subjectto theprovisionsofthisSchedule,theBoardmaydetermine itsownprocedureandtheprocedureforanycommitteeoftheBoardandfor attendanceofanyotherpersonsat themeetingsof theBoard.

I certify that this printed impression is a true copy of the Bill as passed by the Senate on Thursday,12thOctober,2023.

ClerkofiheSenate

Endorsed for presentation to.the National Assembly in accordance with the provisions of standingorder161oftheSenateStandingOrders.

Speakerofth&Sendle