Fresh standoff looms as MPs reject governors’ plea for more funds
MPs said that granting counties a higher allocation would significantly impact the national government’s capacity to meet its financial obligations, particularly debt repayments.
Members of Parliament have dismissed a proposal by governors to increase county allocations from Sh405.06 billion to Sh536.8 billion, citing concerns over the national government’s ability to service mounting public debt.
The National Assembly’s Budget and Appropriations Committee said that granting counties a higher allocation would significantly impact the national government’s capacity to meet its financial obligations, particularly debt repayments.
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“The committee noted that while the proposal is plausible, the national government’s share includes interest payment on public debt, that has been on an upward trajectory and that sharing of resources should be cognisant of the prevailing macroeconomic conditions,” the committee said in its report on the Division of Revenue Bill, 2025.
Governors had argued that counties required additional funds to cater for emerging financial demands such as the housing levy and increased contributions to the National Social Security Fund (NSSF).
However, MPs maintained that the country’s current economic situation could not support the proposed increase.
The National Treasury had recommended that counties receive Sh405.06 billion, with the national government being allocated Sh2.41 trillion and Sh10.58 billion set aside for the Equalisation Fund to support marginalised areas.
The Council of Governors (CoG) had pushed for an increased equitable share, warning that counties were struggling with financial constraints, including pending bills, unremitted statutory deductions and low revenue collection at the devolved level.
“The equitable share to counties be increased from Sh405,069,420,197 to Sh536,880,000,000 to cater for unmet discretionary expenses such as enhanced contributions to NSSF, housing levy deductions,” the CoG said in its submission.
The rejection of the governors’ proposal is likely to escalate tensions between the two levels of government, with county chiefs accusing the national government of failing to prioritise devolution.
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