•The authority was involved in the collection of revenue on behalf of NCCG from March 16, 2020 to September 15, 2022 as per the deed of transfer
•KRA made it clear that once the funds are collected they are later transferred into the County Revenue Fund (CRF).
Image: Handout
It has been revealed that Nairobi County has no control over its revenue collection system which is now under the Kenya Revenue Authority.
The revelations were made during an ad-hoc county assembly committee sitting on Friday where they had invited KRA officials.
Chief Manager for Finance at KRA Hanningotn Ogare, told the MCAs that Nairobi's revenue is collected into two accounts opened by the authority.
"The accounts are held at Equity Bank and Cooperative Bank in the name of Nairobi City County Government," he said.
Despite the two accounts, KRA made it clear that once the funds are collected, they are transferred into the County Revenue Fund (CRF).
Pursuant to the Gazette Notice No.1609 of February 25, 2020, and Gazette Notice 1967 of March 6, 2020, KRA was appointed as the principal agent for the overall collection of all Nairobi County Revenue.
The authority was involved in the collection of revenue on behalf of NCCG from March 16, 2020, to September 15, 2022, as per the deed of transfer.
KRA was to exit in September 2022 following the expiry of the deed.
However, the Peter Imwatok-led committee was told that after the expiry of the deed, Nairobi Governor Johnson Sakaja requested a small team from KRA assist City Hall in the transition period.
Giving details, Annastaciah Githuba, Deputy Commissioner of the County Revenue Division said that she leads a team of nine people to assist in the transition.
"I received a letter from the Governor in December requesting I come to assist in the transition process," she said.
After the expiry of the deed of transfer in September, Githuba said she was redeployed to KRA to do the monthly rental income and domestic services.
The team of nine KRA officials handling the transition report to the County Executive Committee Member for Finance
The committee, however, questioned the request of the Governor noting that anything touching on the deed of transfer was to be approved by the assembly first.
Majority leader Peter Imwatok questioned CEC Finance Charles Kerich on why they allowed a new arrangement between the county and KRA without getting into a formal agreement.
In his response, Kerich said that at that moment If the KRA had left, there were to be a lot of gaps.
"At the moment, it appeared KRA felt like there would be a lot of gaps based on the revenue and that is why the Governor just requested a small team to help in the transition," he said.
Acting County Secretary Patrick Analo also confirmed to be aware of the letter of request from the Governor.
Minority leader Antony Kiragu however questioned whether the Governor by law can make such a request without the involvement of the assembly.
Dandora Two MCA Silaa Matara also questioned whether the letter of request from the Governor had the context and scope of work the 9 KRA officials were to do to help in the transition.
The Committee also heard that Githuba and her team of 9 KRA officials are currently operating from a rented office at KICC which is paid by City Hall's Finance Department.
However, the Chief officer of Finance Asha Abdi denied it, saying that no single shilling had been paid for the KICC office.
No access to servers
CEC Finance Charles Kerich told the MCAs that up to date, the only access the county has to the Nairobi Revenue Service is its dashboard.
However, they don't have access to the servers and they don't know where they are.
Nairobi Revenue Service is a system used by Nairobi County to collect revenue.
Surprisingly, KRA also doesn't have access to the servers as said by Annastaciah Githuba, Deputy Commissioner of the County Revenue Division
MCA Imwatok further asked pressing questions to the KRA officials regarding the NRS.
"Who developed NRS, who is the administrator and as an assembly where can we find its physical address?" he posed
Githuba said that NRS was developed by the Ministry of ICT but unfortunately, they don't know who the administrator is.
"We don't know the physical address of NRS but the focal point to them then was through the defunct Nairobi Metropolitan Service," she said.
KRA steered Nairobi County revenue growth by 15 per cent
In the same sitting, KRA boasted of achieving a 15 per cent increase in overall revenue during the Financial Year 2020-2021 compared to 2019-2020 while overseeing revenue collection for the Nairobi County Government.
Giving details, Annastaciah Githuba, Deputy Commissioner of the County Revenue Division revealed that during the period (FY 2020-21), KRA reported a notable upswing in Nairobi's revenue, rising from Sh 8.49 billion in FY 2019- 2020 to Sh9.76 billion in FY 2020-2021.
She attributed this revenue growth to a 54 per cent increase in land rates, a 35 per cent surge in plans and inspections (building permits), and a remarkable 78 per cent boost in market revenue during the same period.
“The Authority was involved in the deployment of an effective revenue collection strategies and structure and the implementation of the 2019 Valuation Roll,” Githuba stated.
However, it was not a smooth ride as KRA also recorded a decrease in revenue collection in the following year 2021-2022.
Githuba revealed that the decrease was due to it being an election year.
The revenue dropped to Sh8.97 billion as a result of a slowdown of economic activities attributed to the countrywide campaigns during the period.
KRA stated that some of the key challenges encountered were unreliable master data on county revenue sources and customer information, legacy and multiple revenue collection systems that were not integrated and a lack of data to support set revenue targets.
Other challenges included are weak and outdated legal framework, a lack of framework for performance management and accountability of revenue staff deployed at KRA and a lack of adequate ICT infrastructure and connectivity.