THE COUNTY ALLOCATION OF REVENUE BILL, 2025
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KSh 415 Billion Total Equitable Share Allocated
The Bill distributes KSh 415,000,000,000 to Kenya's 47 counties for FY 2025/2026. This comprises:
- A baseline allocation of KSh 387,425,000,000
- An affirmative action allocation of KSh 4,460,000,000
- An additional equitable share allocation of KSh 23,115,000,000
Recurrent Budget Ceilings Capped at KSh 63.3 Billion
Under the Second Schedule, the recurrent expenditures of county governments are strictly capped:
- Cumulative County Assemblies ceiling is set at KSh 39,936,392,660
- Cumulative County Executives ceiling is set at KSh 23,414,610,682
Strict Oversight on Transferred Functions
If a county transfers any function to the National Government under Article 187 of the Constitution:
- The county assembly must appropriate funding not less than the previous year's allocation.
- The receiving national entity must submit quarterly progress reports to the Senate and the respective county assembly.
- The Auditor-General must submit a special audit report within three months after the end of the financial year.
Mandatory Treasury Reporting Duties
The Bill introduces reporting mandates to track allocations:
- The Cabinet Secretary for Finance must publish monthly reports on actual revenue transfers.
- County treasuries must explicitly isolate and reflect equitable share estimates in their books of accounts and quarterly financial reports.
Bill No.
Bill No. 9 of 2025
Gazette No.
Supplement No. 95 of 24th June, 2025
Background
Pursuant to Article 218(1)(b) of the Constitution, the County Allocation of Revenue Bill, 2025 details the division of nationally raised revenue among county governments. It aligns with the fourth determination of the basis of the division of revenue approved by Parliament under Article 217(7) of the Constitution for the 2025/2026 financial year.
Key Provisions
Division of Revenue
Under Section 4, the national government allocates KSh 415,000,000,000 to the 47 county governments. This total sum is divided as follows:
- Baseline Allocation: KSh 387,425,000,000
- Affirmative Action Allocation: KSh 4,460,000,000
- Additional Allocation: KSh 23,115,000,000
Budget Ceilings for Recurrent Expenditure
Section 5 limits the operational recurrent budgets of county organs to the following totals:
- County Assemblies: KSh 39,936,392,660
- County Executives: KSh 23,414,610,682
Transferred Functions
For functions transferred from county governments to the National Government under Article 187 of the Constitution:
- The cost is determined by the county executive in consultation with the National Government.
- The county assembly is required to appropriate funds for the transferred function that are no less than the amount appropriated in the preceding financial year.
New Obligations
- Cabinet Secretary for Finance: Must publish a monthly report detailing all actual fund transfers made to county governments.
- County Treasuries: Must separate their revenue estimates to show the specific equitable share transferred under this Act in their quarterly and annual financial reports.
- National Entities: Any national government entity handling a transferred county function must submit quarterly reports to both the Senate and the respective county assembly on the status of the function.
- Auditor-General: Required to prepare and submit a special audit report on the financial and non-financial performance of the entity handling a transferred function to both the Senate and county assemblies within three months of the financial year's end.
Penalties
- Financial Misconduct: Serious or persistent non-compliance with the provisions of this Act constitutes an offense under the Public Finance Management Act (Cap. 412A).
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