Winners and losers in new counties revenue sharing plan
In the new formula, if approved, Nairobi is one of the 31 counties that will get a lower share even as 16 devolved units get a boost.
What you need to know:
- In the proposed formula, population will account for 42 percent of the revenue that will be received by counties, an increase from the current 18 percent that was used for sharing over the last five years.
31 counties will get a lower share while 16 counties will gain in a new revenue sharing formula proposed by the Commission for Revenue Allocation (CRA) for the 47 devolved units.
The Commission tabled the Fourth Basis for revenue sharing among county governments to the Senate this week. If approved by lawmakers, the revenue sharing formula will be in place for the next five financial years starting with FY2025/26 in July.
In the proposed formula, population will account for 42 percent of the revenue that will be received by counties, an increase from the current 18 percent that was used for sharing over the last five years.
In the new cycle that is expected to kick in during the financial year 2025/2026, equitable share among the 47 counties has been pegged at 22 percent, the geographical size of the county will account for 9 percent, and poverty index will be at 14 percent while the income distance per county will be at 13 percent.
In determining the fourth basis of revenue sharing, the Commission said it has taken into consideration the information on the review of the previous revenue sharing basis, views from the stakeholders, international best practices and criteria in Article 203(1).
In developing the fourth basis, CRA chairperson Mary Chebukati said the commission shifted from the previous functional approach used in the third basis to the use of expenditure proxies.
But while the nominal value of the revenue allocation will increase for all the counties, the new formula means that some counties will reap a bigger raise at the expense of their counterparts.
Losers
In the new formula, if approved, Nairobi is one of the 31 counties that will get a lower share even as 16 devolved units get a boost. The capital will be expected to get a share of 5.05 per cent of the revenue, down from the current 5.21 per cent, making it one of the main losers in the changes.
Details released by CRA show that Mombasa’s share has been cut to 1.98 per cent from 2.04 per cent, while Nakuru and Kisumu’s shares have been cut to 3.42 per cent from 3.53 per cent and 2.1 per cent from 2.17 per cent respectively.
In the proposed formula, Baringo’s allocation has gone down from 1.73 per cent to 1.72 per cent, Bomet from 1.81 per cent to 1.8 per cent, while Bungoma and Embu have been hit by cuts from 2.88 per cent to 2.82 per cent and 1.39 per cent to 1.35 per cent respectively. At the same time, Turkana’s has gone down to 3.31 per cent from 3.41 per cent.
West Pokot’s allocation has been reduced from 1.71 per cent to 1.69 per cent, Uasin Gishu’s share is down to 2.12 per cent from 2.19 per cent, while Trans Nzoia and Nyeri have been given budget cuts to 1.89 per cent from 1.95 per cent and 1.63 per cent from 1.68 per cent respectively while Murang’a’s share has been reduced to 1.88 per cent from 1.94 per cent.
The other counties that have lost include Nyandarua (1.49 per cent from 1.53 per cent), Narok (2.31 per cent from 2.39 per cent), Nandi (1.84 per cent from 1.9 per cent), Migori (2.12 per cent from 2.16 per cent), Meru (2.5 per cent from 2.57 per cent), Mandera (2.93 per cent from 3.02 per cent), Makueni (2.13 per cent from 2.19 per cent) and Machakos (2.4 per cent from 2.48 per cent).
Other losers are Kwale (2.16 per cent from 2.23 per cent), Kitui (2.72 per cent from 2.82 per cent), Kisii (2.33 per cent from 2.4 per cent), Kirinyaga (1.36 per cent from 1.41 per cent), Kilifi (3.05 per cent from 3.14 per cent), Kiambu (3.14 per cent from 3.17 per cent), Kakamega (3.25 per cent from 3.35 per cent), Busia (1.89 per cent from 1.94 per cent) and Homa Bay (2.04 per cent from 2.11 per cent).
Winners
On the flip side, 16 counties emerged as big winners in the new formula, which has raised their revenue share. They include Elgeyo Marakwet whose allocation has been bumped up to 1.29 per cent from 1.225 per cent, Garissa (2.61 per cent from 2.14 per cent), Isiolo (1.5 per cent from 1.27 per cent), Kajiado (2.34 per cent from 2.15 per cent), Kericho (1.83 per cent from 1.74 per cent), Laikipia (1.45 per cent from 1.39 per cent) and Lamu (0.94 per cent from 0.84 per cent).
Other winners include Marsabit (2.26 per cent from 1.96 per cent), Nyamira (1.41 per cent from 1.38 per cent), Samburu (1.52 per cent from 1.45 per cent), Siaya (1.92 per cent from 1.88 per cent), Taita Taveta (1.37 per cent from 1.31 per cent), Tana River (1.38 per cent from 1.36 per cent), Vihiga (1.46 per cent from 1.37 per cent), Tharaka Nithi (1.2 per cent from 1.14 per cent) and Wajir (2.7 per cent from 2.56 per cent).
