Behind the Scenes of the Journey to the Fourth Basis for Revenue Sharing
The preparation of the revenue sharing basis involves numerous stakeholders. In April 2023, the Commission issued a public notice in daily newspapers inviting submissions on the review of the Third Basis for Revenue Sharing Among County Governments and proposals for the Fourth Basis. Additionally, the Commission wrote to all 47 county governments, soliciting their input on the review. As a result, the Commission has received submissions from various stakeholders.
The Commission has engaged with institutions and organizations that made formal submissions and conducted engagements with counties through their respective economic blocs and ministries/departments. These include health, water, agriculture, infrastructure, urban development, and the Kenya National Bureau of Statistics regarding data availability. This comprehensive engagement ensures that all relevant perspectives and data are considered in the development of the new revenue-sharing basis.
The Commission has planned further engagements with the Council of Governors, the National Assembly, the Senate, and the wider public. It remains open to receiving views on the review of the Third Basis for Revenue Sharing among County Governments, as well as proposals on ensuring equitable revenue allocation across all 47 counties. All proposals received will be analyzed to develop revenue sharing criteria that ensure equity in revenue distribution.
The revenue sharing criteria are guided by a broad framework outlined in Article 203 of the Constitution of Kenya, 2010. This framework considers factors such as the ability of counties to perform assigned functions, development needs, economic disparities, affirmative action in disadvantaged areas, economic optimization of revenue-raising capacity, and stability and predictability of allocations. These guidelines ensure a fair and balanced approach to revenue distribution. Proposals from stakeholders have provided recommendations on how Article 203 can be operationalized. The Commission respects the oral and written submissions received, which are currently being analyzed.
There are seven economic blocs that bring several county governments together, with Nairobi City County on its own. These economic blocs are unique and share common challenges and developmental ideologies. The Commission held consultative meetings with each bloc, and a joint meeting with all the counties will also be held once the regional consultations are completed.
