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A wide array of stakeholders voiced their concerns today before the Senate Standing Committee on Finance and Budget regarding the proposed amendments to the Division of Revenue (Amendment) Bill, 2024 (National Assembly Bill No. 38 of 2024).
The central issue discussed was the potential reduction in the equitable share allocation to counties, with many stakeholders expressing serious reservations and offering alternative recommendations.
One of the prominent voices, Bajeti Hub, urged the Committee to reconsider the proposed cuts, advocating for the retention of the original allocation of KES 400.1 billion as stipulated in the Division of Revenue Act, 2024. The organization emphasized that maintaining this allocation is critical to ensuring that County Governments are adequately funded to fulfill their mandates. Bajeti Hub also highlighted the importance of enhancing Counties’ Own Source Revenue (OSR) and proposed a comprehensive assessment of the realistic revenue collection capacities of counties. They stressed the need for harmonization with existing national revenue systems, including the proposed Integrated County Revenue Management System.
The County Assemblies Forum (CAF) also strongly opposed the proposed reduction, which would see the equitable share decrease from KES 400.1 billion to KES 380 billion. CAF argued that the cut is unjustified, lacks a constitutional or legal basis, and could severely undermine the operational viability of County Governments, hindering their ability to effectively serve citizens. The Forum recommended the implementation of comprehensive fiscal reforms to address revenue shortfalls and improve the efficiency and transparency of Public Financial Management.
During the session, the Institute of Certified Public Accountants of Kenya (ICPAK) raised concerns regarding the reliance on audited accounts for the fiscal year 2020/21 as the basis for the proposed changes. ICPAK suggested that these accounts may not accurately reflect the national government’s total revenue collections and recommended that the approval process for the accounts be expedited to ensure a more accurate representation of government revenue.
The Senate Committee members, including Chairman Sen. Ali Roba (Mandera), Vice Chairperson Sen. Tabitha Mutinda, Sen. (Dr.) Boni Khalwale (Kakamega), Sen. Eddy Oketch (Migori), Sen. Joyce Korir, and Sen. Mohamed Faki (Mombasa), acknowledged the stakeholders’ concerns and praised them for their valuable contributions. The Committee encouraged the stakeholders to continue providing suggestions on how to navigate the economic challenges currently facing the nation.
As the discussions progress, the stakeholders’ input is expected to play a crucial role in shaping the final decisions regarding the Division of Revenue (Amendment) Bill, 2024, with the ultimate goal of ensuring that County Governments remain adequately funded to support development and service delivery across the country.
