Counties to bag billions in fresh revenue proposals

Written by on 23 December 2022

Nairobi will get the lion’s share of county allocation if Parliament approves Commission for Revenue Allocation (CRA) proposal.

In its latest proposal on county allocations sent to Parliament for approval, CRA is proposing that in the 2023-24 Financial Year (FY), the 47 county governments should share Sh407 billion, up from the current Sh370 billion.

The Jane Kiringai-led commission argues that the Sh407 billion will translate to 23.5 per cent of the most recent audited and approved accounts for the Financial Year 2019-20, which amounts to Sh1.73 trillion. According to CRA, the shareable revenue is projected to increase by 17 per cent from Sh2.192 trillion in the FY 2022/23 to Sh2.56 trillion in the FY 2023/24.

“Informed by the performance of revenue, the commission recommends an increment in the allocation to each level of government for the Financial Year 2023/24. The National government allocation be increased from Sh1.814.8 trillion to Sh2.150 trillion and county governments’ allocation be increased from Sh370 billion to Sh407 billion,” the recommendations.

Commission also argues that the Third Basis for revenue sharing includes Basic share (20 per cent), Population (18), Health index (17), Poverty head count (14), Agriculture (10),  Land (eight), rural access (eight) and Urban services (five) per cent respectively.

Third Basis for revenue sharing has a baseline allocation to each county equivalent to 50 per cent of a county’s actual allocation for FY 2019-20 of Sh316.5 billion.

Based on this criterion, Sh158.25 billion is shared using the 2019-20 county allocation index and the balance of Sh248.75 billion is shared using the approved Third Basis for revenue sharing.

In its latest recommendation, CRA has proposed that Nairobi should get Sh21.2 billion in revenue sharing.Nakuru will get the second highest at Sh14.3 billion, Turkana (Sh13.8 billion), Kakamega (Sh13.6 billion), Kiambu (Sh12.9 billion), Kilifi (Sh12.7 billion), Mandera (Sh12.2 billion) and Bungoma (Sh11.7 billion) respectively. The determination of each county’s equitable share is based on the Third Basis for revenue sharing.

Second highest

In the proposed allocation, Kitui will get Sh11.4 billion, Meru Sh10.4 billion, Wajir Sh10.3 billion, Machakos Sh10 billion, Narok Sh9.6 billion, Kisii Sh9.7 billion and Kwale Sh9.03 billion.

The commission has also proposed that Uasin Gishu receives Sh8.92 billion, Makueni Sh8.9billion, Kisumu Sh8.83 billion, Migori Sh8.81 billion, Kajiado Sh8.7 billion, Garissa Sh8.6 billion, Homa Bay Sh8.5 billion, Mombasa Sh8.2 billion, Marsabit Sh7.95 billion and Trans Nzoia Sh7.93 billion respectively.

Others are Busia Sh7.9 billion, Murang’a Sh7.8 billion, Nandi Sh7.7 billion, Siaya Sh7.6 billion, Bomet Sh7.3 billion, Tana River Sh7.1 billion, Kericho Sh7.08 billion, Baringo Sh7.03 billion, West Pokot Sh6.9 billion and Nyeri Sh6.8 billion respectively.

Nyandarua Sh6.2 billion, Samburu Sh5.9 billion, Kirinyaga Sh5.7 billion, Laikipia Sh5.66 billion, Nyamira Sh5.61 billion, Embu Sh5.6 billion, Vihiga Sh5.5 billion, Isiolo Sh5.1 billion, Elgeyo Marakwet Sh5.07 billion, Tharaka Nithi Sh4.6 billion and Lamu Sh3.4 billion.

Recommendation for the financial year 2023-24 is the 12th that the commission is making since the beginning of devolution in the financial year 2012-13.

CRA states that the recommendation has been made against the backdrop of economic recovery from the effects of the Covid-19 pandemic, which is expected to improve revenue performance.

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