Editor's Review

“In view of the foregoing and upon careful consideration of the matter at hand, the Council hereby declares a stalemate on the discussions around vertical sharing of revenue." 

The Council of Governors (COG)’s talks with the National Treasury and the Commission on Revenue Allocation (CRA) over revenue sharing in the 2024/2025 financial year have hit a dead end. 

In a statement on Tuesday, COG chairperson Anne Waiguru said the talks between the two levels of Government advanced before the Intergovernmental Budget and Economic Council (IBEC) chaired by Deputy President Rigathi Gachagua but there was no consensus. 

“We however note with concern, that after lengthy discussions and analysis of the proposed recommendations by the task team, the three parties retained divergent positions on their proposed figures for shareable revenue,” read the statement in part.

Waiguru noted that the National Treasury proposed Ksh 391 billion as an equitable share to the counties while the CRA proposed Ksh 398.14 billion. COG on the other hand proposed Ksh 439.5 billion and Ksh.10.52 billion as Road Maintenance Levy Fund (RMLF).

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File image of DP Gachagua chairing IBEC meeting.

“In view of the foregoing and upon careful consideration of the matter at hand, the Council hereby declares a stalemate on the discussions around vertical sharing of revenue,” Waiguru stated.

The COG chair urged the state to adopt the Ksh 450 billion allocation to the counties saying they should be cushioned from the rising cost of inflation across various devolved sectors.

Waiguru also argued that there are rising operations and maintenance costs in Counties, a need for a commensurate adjustment for revenue growth, and provision of an allocation towards County employees' annual salary incremental cost;

“We therefore call upon the National Government to reconsider their position in view of the aforementioned budgetary items. This will allow Counties to execute their mandate and ensure efficient service delivery on their assigned functions,” Waiguru stated.