Counties raised their own source revenue collection by Sh4.51 billion during the first nine months of the current financial year, in an improvement that helped the devolved units to run operations amid disbursement delays from the National Treasury.
The latest disclosures from the Controller of Budget (CoB) show that the 47 counties raised Sh45.91 billion during the period, representing a 10.9 percent jump from the Sh41.4 billion realised in a similar period the prior year.
"During the reporting period, county governments generated a total of Sh45.91 billion from their own-source revenue (OSR), which was 53 percent of the annual target of Sh87.11 billion,” CoB Margaret Nyakang’o said in her latest report.
“The realised OSR is an increase compared to Sh41.40 billion generated in a similar period in the financial year 2023/24.”
The enhanced collections spared the devolved units from slumping into a cash flow crisis following delays in receiving their portion of the billions allocated to them as equitable shares from the national exchequer.
During the period under review, only five counties exceeded 75 percent of their annual targets, with Tana River and Garissa surmounting the annual value at 172 percent and 104 percent respectively.
Others within the target schedule were Narok which realised 99 percent of their full-year goal, Samburu (85 percent), and Kirinyaga (78 percent).
“Tana River county’s exceptional performance during this review period is attributed to revenue from the significant gypsum extraction,” noted Dr Nyakang’o.
Conversely, 15 counties had their OSR fall below 50 percent of the annual target, setting them on course to miss the targets by the close of the financial year later this month.
Taita Taveta, Kisumu, Bungoma, and Machakos were the worst performers with their collections being less than 40 percent of their full-year targets.
“For county governments whose OSR performance in the review period fell short of their projected targets for the first nine months of the financial year 2024/25, the Controller of Budget recommends implementing strategies to collect the remaining balance within the available timeframe,” recommended Dr Nyakang’o.
“Additionally, these counties should consider revising their OSR projections for the next period to align with realistic and achievable targets, which can be achieved by using an objective revenue forecasting model.”
The counties have, within the fiscal year, faced delays in receiving part of the Sh387.43 billion equitable share, with governors last November threatening to shut down the devolved governments following Parliament’s failure to pass legislation to guide the disbursements.
CoB says that as of March this year, the counties had received Sh330.83 billion inclusive of Sh27.21 billion relating to cash balances brought forward from the prior financial year as well as Sh30.83 billion arrears for June 2024.
During the reporting period, development expenditure for the counties totalled Sh56.87 billion translating to an absorption rate of 26 percent of the Sh222.2 billion cumulative annual development budget, while recurrent expenditure stood at Sh229.24 billion.
