Revenue collection by the 47 counties dipped marginally in the six months to December 2019 compared to similar period in the 2018/19 fiscal year, highlighting the continued struggles by the devolved units to become self-sustaining.
The Controller of Budget (CoB) in the report for the first six-month period shows the counties raised Sh15.33 billion, a fall of 0.3 percent from the similar period in 2018/19.
The drop continues to hurt delivery of key services like health, water and sewerage and roads with Controller of Budget Margaret Nyakang’o asking the counties revamp collection systems to free up more money for development.
The near-flat performance comes at a time the Treasury has unveiled plans to assist counties increase their collections, including automation and deploying the Kenya Revenue Authority (KRA) to collect.
“The county should institute mechanisms aimed at enhancing own source of revenues in order to improve on budget execution,” the Controller of Budget said in the report.
Counties cut spending on development projects like roads and health by 6.5 percent to Sh22.77 billion in the period under review from Sh24.36 billion in the first six months of 2018/19.
An analysis of the CoB data shows that Narok at 63.1 percent, Isiolo (56.3 percent) and Samburu at
56.1 percent achieved the highest proportions of targeted annual collections.
During the period, Narok collected Sh1.9 billion against a target of Sh2.995 billion, Isiolo achieved Sh96 million against the targeted Sh170.86 million and Samburu collected Sh149.9 million against a target of Sh267.03 million.
The Sh15.33 billion total collection, however, remains the second highest raised in the first six months of a financial year since start of devolution in 2014 while the lowest remains Sh9 billion raised in the first year of devolution.
The Treasury, in its draft national policy to support enhancement of county revenues, wants the devolved units compelled to contract the KRA for collection of fees and levies.
The KRA last month started collecting taxes on behalf of Nairobi County following the transfer of health services, transport, planning and development and public works and utilities to the State and this is expected to increase the county’s own-source revenue.