The County Allocation of Revenue Bill (Senate Bill No. 25 of 2024)

REPUBLICOFKENYA

PARLIAMENT

SENATE BILLS

(Bill No. 25 of 2024)

THE COUNTY ALLOCATION OF REVENUE BILL, 2024

(A Bill published in the Kenya Gazette Supplement No. 95 of 3rd May, 2024 and passed by the Senate, with amendments, on 11h June, 2024.)

Clause

• 1—Short title.

• 2—Interpretation.

• 3— Object.

• 4—— Equitable allocation of county governments’ share of revenue.

• 5— Budget ceilings for recurrent expenditure.

• 6—Funding of transferred functions.

• 7—— Report on actual transfers.

• 8—Books of accounts to reflect National Government transfers.

• 9-- Financial misconduct.

• 10— Applicable revenue - sharing formula.

FIRSTSCHEDULE:ALLOCATION OFEACH COUNTY GOVERNMENTS' EQUITABLESHAREOFREVENUERAISEDNATIONALLY INTHEFINANCIALYEAR2024/2025

SECONDSCHEDULE: COUNTYGOVERNMENTBUDGET CEILINGS OF RECURRENTEXPENDITUREINTHEFINANCIALYEAR 2024/2025

THECOUNTYALLOCATIONOFREVENUEBILL,2024

ARRANGEMENTOFCLAUSES

Short title.

Interpretation.

Cap.428.

Object.

Equitable allocationof county governments' shareofrevenue.

THECOUNTY ALLOCATIONOFREVENUEBILL,2024

A Bill for

ANACT of Parliament toprovide for the equitable allocation of revenue raised nationally among the county governments for the 2024/2025 financial year; the responsibilities of national and county governments pursuant to such allocation; and for connected purposes.

ENACTEDbyParliament of Kenya, as follows-

1. This Act may be cited as the County Allocation of Revenue Act, 2024. 2. 2.InthisAct—

"Cabinet Secretary" means the Cabinet Secretary responsible for matters relating to finance; and

"revenue" has the meaning assigned to it under section 2 of the CommissiononRevenueAllocationAct.

• 3.The objectofthisActisto-
• (a)provide,pursuant to Article 218(1)(b) of the Constitution,for theallocationof anequitableshareof revenueraised nationally among the county governments, in accordance with the resolution approved by Parliament under Article 217 ofthe Constitutionfor thefinancialyear 2024/25; and
• (b)facilitate the transfer of allocations made to counties under this Actfrom the Consolidated Fund to therespective County RevenueFunds.

4. (1) Each county governments′ equitable share of revenue raised nationally,on the basis of the revenue sharing formula approved by Parliament in accordance withArticle 217ofthe Constitution in respect of thefinancialyear 2024/25shall be as set out in ColumnFoftheFirst Schedule.

Cap 412A.

Budget ceilings forrecurrent expenditure.

Funding of transferred functions.

Report on actual transfers.

(2) Each county government's allocationunder subsection (l) shall be transferred to the respective County Revenue Fund in accordance with apaymentschedule approved bytheSenateandpublished in the GazettebytheCabinetSecretaryinaccordancewithsection17of the PublicFinanceManagementAct.

5.The budget ceilings for recurrent expenditure for county governments forthefinancialyear 2024/2025shall be as set out in the SecondSchedule.

6. (1) Where a county government has transferred a function to the National Government pursuant to Article 187 of the Constitution, the respective countyexecutive in consultationwith the National Government shall determine the cost of the transferred functions.

(2) The respective county assembly shall appropriate such monies as maybe required for the transferredfunction in accordance with the determination made under subsection (1) and the allocation shall not be less than the amount appropriated by the county assembly in the precedingfinancialyear.

(3) The monies appropriated under subsection (1) shall be transferredtotheNational Government.

(4)A National Governmententity towhich acountygovernment function has been transferred shall submit a quarterly report to the Senate and the respective county assembly on the status of the discharge of the devolved function.

• (5)The Auditor-General shall,no later than three months after the end of a financial year, prepare a special audit report on the financial and non-financialperformanceof anentitytowhichacounty government function has been transferred.
• (6)The Auditor-General shall submit the report under subsection (5)to theSenate and therespective county assembly.

7.The Cabinet Secretary shall publish a monthlyreport on actual transfers of all allocations to county governments.

| Books of accounts toreflectNational Government transfers. | 8.(1) Each county treasury shall reflect all transfers by the national government to the county governments in its books of accounts. (2) The estimates of revenue of each county shall separately reflect thetotalequitablerevenueshareundersection4ofthisActtransferred totheCountyRevenueFund. | |-------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | Cap.412A. | (3) A county treasury shall as part ofits consolidated quarterly and annual reports required under the Public Finance Management Act report on actual transfers received by the county government from the national government, up to the end of that quarter or year in the format prescribed by thePublic Sector AccountingStandards Board or in the absence of a format prescribed by theBoard,in theformat prescribed bytheNational Treasury. | | Financial misconduct. | 9. Despite the provisions of any other law, any serious or persistent non-compliance with provisions ofthis Act constitutes an offence under | | Cap.412A | thePublicFinanceManagementAct. | | Applicable revenue-sharing formula. | 10.For the avoidanceof doubt the allocationoftheequitableshare of revenue to county governments under section 4 of this Act shall be inaccordancewiththethirddeterminationofthebasisofthedivision of revenue among counties approved by Parliament pursuant to Article 217(7)oftheConstitution. |

TheCountyAllocationofRevenueBill,2024

FIRSTSCHEDULE (s.4(1))

| 6,912,927,952 7,251,128,230 Total Equitable ColumnF=C+E | 11,543,041,769 7,764,601,080 4,987,118,183 5,548,094,359 8,555,015,575 8,436,080,677 5,078,735,614 Share**** | 8,629,255,865 13,411,035,025 6,962,657,506 12,713,359,169 12,554,603,733 5,633,619,143 9,605,604,088 8,681,516,388 11,244,322,462 8,887,496,757 5,569,687,183 3,362,798,128 | |-----------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | 4,365,102,952 4,497,578,230 Equitable Share ColumnE | 7,096,216,769 4,757,851,080 3,056,468,183 3,395,894,359 5,041,865,575 5,065,355,677 2,958,185,614 | 5,416,780,865 8,204,610,025 4,272,407,506 7,997,509,169 7,332,353,733 3,513,069,143 5,712,654,088 5,263,316,388 6,829,147,462 4,994,546,757 3,480,787,183 2,065,148,128 | | 1.80 1.86 2.93 | 19 1.26 1.40 2.08 2.09 1.22 | 2.24 3.39 1.77 3.31 3.03 1.45 2.36 2.18 2.82 2.06 1.44 0.85 | | 0.5AllocationRatio) (Equitable Share**- Allocation ratio *(Formula***) ColumnD 2,547,825,000 2,753,550,000 Equitable Share Column | 4,446,825,000 3,006,750,000 1,930,650,000 2,152,200,000 3,513,150,000 3,370,725,000 2,120,550,000 | 3,212,475,000 5,206,425,000 2,690,250,000 4,715,850,000 5,222,250,000 2,120,550,000 3,892,950,000 3,418,200,000 4,415,175,000 3,892,950,000 2,088,900,000 1,297,650,000 | | 1.61 1.74 0.5(Allocation FY2024/25 Ratio*) | 2.81 1.9 1.22 1.36 2.22 2.13 1.34 | 2.03 3.29 17 2.98 3 1.34 2.46 2.16 2.79 2.46 1.32 0.82 | | Allocation ratio ColumnB 6,647,771,186 6,977,924,070 11,111,98,8 7,475,585,295 4,801,453,188 5,341,810,744 FY2023/24 ColumnA | 8,248,748,101 8,128,387,250 4,899,041,209 8,300,213,576 | 12,912,646,22 6,703,129,925 12,227,552,449 12,109,200,498 5,420,217,528 9,258,588,608 8,361,797,770 10,829,486,936 8,584,103,693 5,358,246,532 3,237,350,707 | | Bungoma County Baringo Bomet 3 | Elgeyo/Marakwet HomaBay Busia Embu Garissa Isiolo 6 | Kakamega Kirinyaga Kajiado Kericho Kiambu Kilifi Kisii Kisumu Kitui Kwale Laikipia Lamu | | 2 | 4 5 8 9 | 10 12 3 14 15 16 7 18 19 2 Z |

The County Allocation of Revenue Bill, 2024

| Total Equitable Share**** | ColumnF=C+E | 9,914,003,936 8,762,816,136 | 12,054,974,661 | 7,830,334,637 | 10,272,457,095 | 8,661,896,842 8,141,725,357 | 7,753,474,531 20,855,390,632 | 14,133,795,185 7,604,787,567 | 9,531,074,923 | 5,523,614,355 | 6,130,324,412 | 6,729,749,120 5,806,692,471 | 7,545,450,410 | 5,229,266,247 7,040,540,708 | 4,534,480,732 | 7,798,593,372 13,653,200,352 | 8,766,325,224 5,457,216,386 10,214,92,219 | 6,837,314,170 | |-----------------------------------------|---------------|-------------------------------|------------------|-----------------|------------------|-------------------------------|--------------------------------|--------------------------------|-----------------|-----------------------------|-----------------|-------------------------------|-----------------------------|-------------------------------|-----------------------------|--------------------------------|---------------------------------------------|-----------------| | Equitable Share | Column E | 6,036,878,936 5,059,766,136 | 6,943,499,661 | 4,443,784,637 | 6,252,907,095 | 5,275,346,842 4,612,750,357 | 4,604,299,531 12,895,415,632 | 8,895,720,185 4,930,362,567 | 5,511,524,923 | 3,118,214,355 | 3,693,274,412 | 4,023,674,120 3,496,242,471 | 4,649,475,410 | 3,108,716,247 4,112,915,708 | 2,572,180,732 4,918,443,372 | 8,383,475,352 | 5,601,325,224 3,130,941,386 5,941,842,219 | 4,336,964,170 | | 0.5 Allocation Ratio) Allocation ratio | ColumnD | 2.50 2.09 | 2.87 | 1.84 | 2.59 | 2.18 1.91 | 1.90 5.33 | 3.68 2.04 | 2.28 | 1.29 | 1.53 | 1.66 1.45 | 1.92 | 1.29 1.70 1.06 | 2.03 | 3.47 2.32 | 1.29 2.46 | 1.79 | | Equitable Share | ColumnC | 3,877,125,000 3,703,050,000 | 5,111,475,000 | 3,386,550,000 | 4,019,550,000 | 3,386,50,0 3,528,975,000 | 3,149,175,000 7,959,975,000 | 5,238,075,000 | 2,674,425,000 | 4,019,550,000 2,405,400,000 | 2,437,050,000 | 2,706,075,000 2,310,450,000 | 2,895,975,000 2,120,550,000 | 2,927,625,000 1,962,300,000 | 2,880,150,000 5,269,725,000 | 3,165,000,000 | 2,326,275,000 4,272,750,000 | 2,500,350,0 | | Allocationratio 0.5 (Allocation Ratio*) | ColumnB | 2.45 2.34 | 3.23 | | 2.54 | 2.14 2.23 | 1.99 5.03 | 3.31 1.69 | 2.54 | 15 | 1.54 1.71 | 1.46 | 1.83 | 1.85 1.24 | 1.82 | 3.33 | 1.47 2 | 1.58 | | | ColumnA | 9,547,295,309 8,455,460,962 | 11,633,191,646 | 7,560,398,412 | 9,892,625,172 | 8,341,446,108 7,861,523,820 | 7,473,786,703 20,072,059,115 | 13,593,424,693 7,305,294,033 | 9,196,276,899 | 5,334,198,486 | 5,905,976,056 | 6,485,331,051 | 5,594,312,489 7,263,019,462 | 5,040,427,430 6,790,702,542 | 4,378,234,821 | 7,499,822,440 13,143,946,933 | 8,426,072,635 5,267,026,885 9,853,656,422 | 6,573,866,403 | | | County | Machakos Makueni | Mandera | Marsabit | Meru | Migori Mombasa | Murang'a Nairobi | Nakuru Nandi | Narok | Nyamira | Nyandarua | Nyeri Samburu | Siaya Taita/Taveta | Tana River Tharaka Nithi | TransNzoia | Turkana | Uasin Gishu Vihiga Wajir | WestPokot | | | | 2 23 | 忆 | 25 | 2 | 8 | 3 | 3 3 | 3 | | 5 36 | 3 | 3 3 | 4 | 4 | 4 | 4 5 | 4 |

5

The County Allocation of Revenue Bill, 2024

| 400,116,788,147 Total Equitable ColumnF=C+E Share**** 241,866,788,147 EquitableShare ColumnE 100 (Equitable Share**- 0.5AllocationRatio) Allocationratio *(Formula***) Column D 158,250,000,000 EquitableShare ColumnC Allocationratio 100 0.5 (Allocation FY2024/25 Column B Ratio*) 385,424,616,067 FY2023/24 ColumnA County Total NS | |------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

• This is the Ksh. 316.5 billion allocations as Equitable Share to counties in the financial year 2019/20. Thus, the allocation to county governments under this component is one half of Ksh. 316.5 billion, amounting to Ksh. 158.25 billion.

you net out one half of the amount of Allocation Ratio or Ksh. 158.25 billion from the Equitable Share of Ksh. 400.117 billion, the resulting balance of Ksh. 241.867 billion shall be allocated among county governments using the Formula.

Indexi1+0.08*Roads Indexi +0.20* Basic Share Index.

SECONDSCHEDULE(S.5)

| County GovernmentBudget Ceilings on Recurrent Expenditure inFY 2024/25 (Figures inKenya Shillings) | County GovernmentBudget Ceilings on Recurrent Expenditure inFY 2024/25 (Figures inKenya Shillings) | County GovernmentBudget Ceilings on Recurrent Expenditure inFY 2024/25 (Figures inKenya Shillings) | County GovernmentBudget Ceilings on Recurrent Expenditure inFY 2024/25 (Figures inKenya Shillings) | County GovernmentBudget Ceilings on Recurrent Expenditure inFY 2024/25 (Figures inKenya Shillings) | |------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------| | | | CountyAssemblyCeilings | CountyAssemblyCeilings | CountyExecutiveCeilings | | SN | County | 2023/24 | 2024/25 2023/24 | 2024/25 | | 1 | Baringo | 828,250,102 | 880,134,270 628,507,168 | 811,330,131 | | 2 | Bomet | 826,903,256 748,458,555 | 525,981,274 | 675,271,762 | | 3 | Bungoma | 1,030,966,304 1,166,950,433 | 593,145,551 | 794,269,934 | | 4 | Busia | 890,557,352 891,698,127 | 565,353,297 | 740,954,156 | | 5 | Elgeyo/Marakwet | 688,567,522 731,876,015 | 540,143,817 | 682,571,452 | | 6 | Embu | 655,164,072 696,347,072 | 470,665,205 | 599,617,223 | | 7 | Garissa | 928,822,377 1,034,099,730 | 517,163,240 | 693,214,915 | | 8 | Homa Bay | 951,617,005 967,160,105 | 612,652,603 | 807,946,650 | | 9 | Isiolo | 539,314,722 556,240,773 | 384,717,582 | 483,811,987 | | 10 | Kajiado | 836,365,718 825,532,961 | 543,625,285 | 705,785,753 | | 11 | Kakamega | 1,400,821,103 1,482,723,167 | 702,976,417 | 954,360,037 | | 12 | Kericho | 828,466,755 829,314,633 | 574,171,331 | 742,119,652 | | 13 | Kiambu | 1,352,347,776 1,354,132,186 | 689,615,145 | 937,949,817 | | 14 | Kilifi | 942,241,093 901,685,828 | 552,882,777 | 732,390,410 | | 15 | Kirinyaga | 673,319,674 685,609,542 | 463,453,685 | 591,357,406 | | 16 | Kisii | 1,112,890,743 1,114,637,995 | 635,010,868 | 842,938,395 | | 17 | Kisumu | 827,121,358 1,008,619,656 | 548,429,020 | 720,990,566 | | 18 | Kitui | 1,042,409,957 1,062,587,992 | 787,239,883 | 1,034,274,047 | | 19 | Kwale | 667,712,409 685,501,295 | 436,816,651 | 561,039,626 | | 20 | Laikipia | 545,809,049 548,716,069 | 429,430,142 | 543,968,003 | | 21 | Lamu | 493,148,394 507,472,589 | 349,978,277 | 439,219,777 | | 22 | Machakos | 1,021,331,660 1,094,313,264 | 618,887,863 | 817,384,477 | | 23 | Makueni | 882,052,960 870,638,166 | 597,330,868 | 772,648,310 | | 24 | Mandera | 983,911,204 955,086,307 | 537,192,934 | 709,410,958 | | 25 | Marsabit | 714,092,325 765,337,855 | 477,791,217 | 620,635,223 | | 26 | Meru | 1,105,946,626 1,110,234,818 | 802,472,137 | 1,046,885,894 | | 27 | Migori | 1,003,508,709 1,006,160,215 | 609,089,597 | 803,308,177 | | 28 | Mombasa | 837,169,783 773,735,933 | 414,726,825 | 550,949,872 | | 29 | Murang'a | 830,709,033 841,956,442 | 633,050,405 | 822,212,796 | | 30 | Nairobi City | 1,924,120,608 1,925,111,836 | 640,180,465 | 924,648,890 | | 31 | Nakuru | 1,160,413,432 1,189,221,758 | 703,777,688 | 949,692,125 | | 32 | Nandi | 796,999,461 881,813,047 | 647,212,948 | 829,614,196 | | 33 | Narok | 911,202,495 912,668,217 | 545,667,285 | 715,936,269 | | 34 | Nyamira | 746,578,493 709,762,663 | 458,194,685 | 584,106,355 | | 35 | Nyandarua | 770,438,804 783,592,426 | 533,107,285 | 683,959,845 | | 36 | Nyeri | 776,126,610 854,822,168 | 605,347,631 | 779,895,747 | | 37 | Samburu | 593,254,286 611,949,367 | 482,789,720 | 611,274,116 | | 38 | Siaya | 775,678,151 784,422,102 | 540,322,777 | 701,924,604 | | 39 | Taita/Taveta | 681,840,554 706,520,871 | 439,488,905 | 567,140,475 |

TheCountyAllocationofRevenueBill,2024

| County Government Budget Ceilings on Recurrent Expenditure in FY 2024/25 (Figures in Kenya Shillings) | County Government Budget Ceilings on Recurrent Expenditure in FY 2024/25 (Figures in Kenya Shillings) | County Government Budget Ceilings on Recurrent Expenditure in FY 2024/25 (Figures in Kenya Shillings) | County Government Budget Ceilings on Recurrent Expenditure in FY 2024/25 (Figures in Kenya Shillings) | County Government Budget Ceilings on Recurrent Expenditure in FY 2024/25 (Figures in Kenya Shillings) | County Government Budget Ceilings on Recurrent Expenditure in FY 2024/25 (Figures in Kenya Shillings) | |---------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------| | | | CountyAssemblyCeilings | CountyAssemblyCeilings | CountyExecutiveCeilings | CountyExecutiveCeilings | | SN | County | 2023/24 | 2024/25 | 2023/24 | 2024/25 | | 40 | Tana River | 677,653,973 | 733,643,957 | 436,641,663 | 558,967,389 | | 41 | Tharaka-Nithi | 517,563,626 | 545,776,919 | 445,463,668 | 561,403,884 | | 42 | Trans Nzoia | 685,259,476 | 700,394,742 | 427,107,865 | 557,198,937 | | 43 | Turkana | 966,834,859 | 895,679,650 | 526,961,505 | 704,903,707 | | 44 | Uasin Gishu | 796,524,510 | 805,657,536 | 474,407,171 | 623,694,943 | | 45 | Vihiga | 714,071,318 | 724,667,651 | 487,678,963 | 628,658,777 | | 46 | Wajir | 992,922,326 | 992,609,870 | 599,569,960 | 791,932,190 | | 47 | West Pokot | 683,634,469 | 720,096,706 | 589,135,145 | 743,044,332 | | | Total | 40,612,656,492 | 41,575,373,479 | 25,825,556,393 | 33,756,814,187 |

I certify that this printed impression is a true copy of the Bill as passed by the Senate on Tuesday, 11th June, 2024.

Endorsed for presentation to theNational Assemblyin accordancewith theprovisions of standing order 161(1) of the Senate Standing Orders.

SpeakerRftheSenate