Twelve historically marginalised counties will share Sh4.46 billion in the financial year 2025/26 under the newly assented division of revenue sharing formula.
The inclusion of the Sh4.46 billion Affirmative Action Allocation seeks to accelerate development and bridge inequality gaps in regions historically perceived as marginalised.
The counties set to benefit are Elgeyo-Marakwet, Embu, Isiolo, Kirinyaga, Laikipia, Lamu, Nyamira, Nyandarua, Samburu, Taita- Taveta, Tharaka-Nithi and Vihiga.
President William Ruto has assented to the mediated version of the Division of Revenue Bill paving the way for the disbursement of Sh415 billion to county governments as equitable share for the 2025/26 financial year.
Chairperson of the National Assembly's Budget and Appropriations Committee and Alego Usonga MP Samuel Atandi at the County Hall Nairobi on Wednesday, March 12, 2025.
Photo credit: Dennis Onsongo| Nation Media Group
The allocation was approved by both the National Assembly and Senate after a mediation committee settled on a compromise version proposing Sh415 billion for counties.
Under the fourth basis for equitable revenue sharing, the 12 counties long plagued by underdevelopment, poor infrastructure and limited access to essential services will each receive Sh371.6 million.
Additionally, the Equalisation Fund was allocated Sh9.6 billion bringing added support to 34 marginalised counties.
Budget and Appropriations Committee Chairperson Samuel Atandi, who is also the MP for Alego Usonga, said the updated formula reflects Kenya’s evolving development priorities and commitment to equity.
Mr Atandi said that revenue-sharing formulas are reviewed every five years and are critical in guiding how national resources are distributed to counties.
The revised formula introduces a two-tier County Equitable Share approach using key indicators such as the population index (based on the 2019 census), Equal Share Index, Poverty Index (from the 2022 KNBS Poverty Report) and geographical size.
According to Mr Atandi, the Sh4.46 billion additional allocation to 12 counties is designed to compensate for historic underinvestment and help these regions to catch up in development.
“Many parameters have been used in the past when considering the allocation and sharing of resources among counties. This formula will ensure that counties that have not properly engaged in development programmes now have an opportunity to do so,” he said.
Elgeyo-Marakwet struggles with perennial banditry and inter-community conflicts, particularly along its borders with Baringo and West Pokot. These security concerns have disrupted education and stalled infrastructure development.
Isiolo County faces frequent droughts, low literacy rates and poor access to healthcare, with nomadic populations hard to reach.
Lamu, a coastal county, grapples with insecurity from terror threats, poor infrastructure and low school enrolment especially on remote islands.
On the other hand, Samburu faces high poverty levels, widespread FGM practices, low school retention rates and persistent cattle rustling.
The Division of Revenue Bill, now the Division of Revenue Act, determines how national revenue is equitably shared between the national and county governments each financial year.
Notably, the new law includes a special clause protecting county budgets from potential national revenue shortfalls in times of economic disruption. This means the national government will absorb the deficit and ensure counties run their services as planned.
Meanwhile, the Equalisation Fund will support critical projects in 34 marginalised counties aimed at improving access to water and healthcare services.
