Nairobi losing over Sh400,000m of city markets revenue

MCA terms it impossible for the city to have only 43 markets, county accused of setting low targets that are easy to meet

In Summary

•The county is only able to collect revenue from 43 main markets.

City Hall 's Director for Markets Frederick Ndunyi during a meeting with the Nairobi County Assembly committee on Budget and Appropriations and market leaders at City Hall on March ,2019.
City Hall 's Director for Markets Frederick Ndunyi during a meeting with the Nairobi County Assembly committee on Budget and Appropriations and market leaders at City Hall on March ,2019.

City Hall is losing over Sh400,000 million in revenue from over 100 markets in the city.

The county is only able to collect revenue from 43 main markets, raising concerns of weak reinforcement from the revenue team.

Market representatives who appeared before the  Budget and Appropriations Committee on Wednesday confirmed that many traders are conducting business in market without being taxed.

Director of markets Fredrick Ndunyu was unable to disclose to the committee the exact number of markets within Nairobi.

He said that there are only 43 operational markets which the committee and the heads of different markets differed with.

However, Embakasi ward rep Michael Ogada dismissed his figure stating  that Nairobi has over 100 existing markets.

‘We have 85 wards in Nairobi and each ward cannot lack a market. How can the director justify that the city only has 43 markets. Embakasi ward has five markets which are not recognised by the county government, yet money is collected daily. Where does dis money go to?" Ogada posed.

The director was put on the spot when he failed to answer the amount the county had collected as revenue from markets since the financial year 2018-19 started.

In his defence, Ndunyu said he had only been in office for three months and had not familiarised himself properly with the system.

Missed targets

The committee also established that the market revenue has not been meeting its targets in the past financial years despite being allocated a substantial amount in the budget.

In the last financial year ( 2017-18 ) the total revenue collected from markets was Sh253.8 million.

As of mid year of the current financial year  (December 31, 2018), the county had collected Sh146. 2 million as revenue.

On Tuesday, only Sh325, 000 had been collected from markets which according to the committee is very low.

Ndunyu said this financial year their approximation revenue target is around Sh500,000 but at the moment they have not collected close to a quarter of it.

Ogada said the market sector has a lot of loopholes in markets which affects its revenue targets and collection.

"I can  tell you without fear that in the market sector we are not raising even 15 per cent of what we should be collecting," Ogada said.

The county was accused of setting low targets,which are easier to meet but despite that, they even fail to meet their own set targets.

Cash in hand payment 

It was revealed that some payments are still done to the county using the cash-in-hand method despite Governor Sonko's announcement that City Hall is running cashless system.

The market representatives also said that they are never issues with receipts once they make payments.

The committee's vice chairman Patrick Karani said revenue is lost at source because of such practices.

"How are the market traders held accountable for their payments if they are not being given receipts, and where does the collected money go to ?" 

The committee also condemned  use of paybill numbers in markets arguing that there is no way  the traders could attach the paybill payment to indicate they have made payments to the county.

The MCAs further stated that there are serious weak internal enforcement in the county hence no accountability for the money collected.


Committee chairman Robert Mbatia called on the executive to carry an audit of all markets and reinforce revenue collections to enable the county meets its target.

“It is important that the county finds a way of expanding its capacity and get to all these markets because we are doing badly as a county. In the budget, markets always get serious allocations but in return we don’t get even close to 30 per cent as revenue in return," Mbatia said.

He further said  the committee will also look into the executive structure of markets.

It had been said that the directors in charge of specific markets are still revenue officers which is not suppose to be the case.

"We will also look at the revenue collectors. These people are assessing, collecting, invoicing and reporting. This is not a normalcy," Mbatia said.

The committee pledged to work together with the  assembly and bring the necessary changes in the market segment of the county government to prevent money being lost further.

Edited by Rosemary Wangui