Treasury CS John Mbandi when he appeared before the Senate Standing Committee on Devolution. Photo Andrew Mbuva 
By Andrew Mbuva
The National Treasury has taken a bold step toward enhancing fiscal discipline in county governments by implementing the Treasury Single Account (TSA) system, a landmark reform aimed at tightening control over public finances.
Appearing before the Senate Standing Committee on Devolution and Intergovernmental Relations, Cabinet Secretary for the National Treasury and Economic Planning, John Mbadi, said the Cabinet had already approved the rollout of the TSA as mandated by law, terming it a game-changer in the fight against mismanagement and fraud.
“The implementation of this policy is part of the broader Treasury Single Account action plan that is expected to improve financial governance and control over public funds. The primary goal is to ensure accountability and transparency in the use of public resources,” CS Mbadi told Senators.
The TSA is a government financial management tool that consolidates all revenues, receipts, and income into a central bank account, typically managed by the Central Bank of Kenya. The system is designed to eliminate fragmented banking arrangements in public finance and improve oversight on the use of taxpayer money.
The push to operationalise the TSA follows concerns raised by the Controller of Budget through the County Budget Implementation Review Report submitted to the Senate. The report revealed that counties were operating a staggering 1,854 commercial bank accounts in breach of the Public Finance Management Regulations, 2015.
The proliferation of these accounts has made it increasingly difficult for the Controller of Budget to monitor county spending, opening the door for potential misuse of public funds.
In response, Senators urged the National Treasury to fast-track the implementation of a TSA framework tailored for county governments. They called for a hybrid model that would give Treasury visibility into county account balances without infringing on county autonomy.
“Hon. Mbadi, your Ministry needs to review the existing regulations to provide clarity on the requirements for county governments to open commercial bank accounts, and explore options to compel full disclosure of all accounts,” said Committee Chairperson, Senator Mohamed Abbas.
Senators also advised the Treasury to collaborate with the Council of Governors (CoG) and the Senate Standing Committee on Finance and Budget to develop a practical and inclusive TSA system that considers the operational needs of devolved units.
Mbadi, who served previously as the Member of Parliament for Suba South, praised the TSA initiative as a critical reform to strengthen the country’s public finance management. “This is a significant policy that will reduce the risk of mismanagement and enhance transparency by centralising funds in a system that is accountable,” he stated.
The Treasury CS appeared before the Senate as part of an ongoing inquiry into the large number of commercial bank accounts operated by counties, which lawmakers say undermines accountability and enables financial leakage.
As the government tightens the noose on financial loopholes in the devolved units, the successful implementation of the TSA could usher in a new era of fiscal discipline and transparency in Kenya’s public
