- This is an increase of Sh2.1 billion of the current budget which is at Sh40.7 billion.
- The six key own-source revenue streams include parking fees, rates, single business permits, house rents, building permits and billboards and adverts.
Nairobi Governor Johnson Sakaja’s administration aims to increase Nairobi budget for Financial Year 2024/25 to Sh42.8 billion
This is highlighted in the County Fiscal Strategy Paper, 2024 (draft).
From the budget, Sh20.06 billion will be raised from the Own Source Revenue (internal revenue) and Sh20.9 billion from external revenue.
This is an increase of Sh2.1 billion of the current budget which is at Sh40.7 billion.
“The projected revenue for FY 2024-25 is Sh42.8 billion. It is projected that Sh20.06 billion will be raised from own source revenue, Sh1.35 billion from liquor board and hospitals and Sh20.85 billion from external revenue (Equitable share and other grants),” reads the paper.
The six key own-source revenue streams include parking fees, rates, single business permits, house rents, building permits and billboards and adverts.
They account for close to 80 per cent of the county’s annual own-source revenue.
For Sakaja’s second budget, City Hall has set a target for rates at Sh6.7 billion, single business permits at Sh3.2 billion, parking fees at Sh3 billion, building permits at Sh2 billion, billboard and adverts Sh1.2 at billion.
Others include markets Sh320 million, fire services Sh450million, house rents Sh600 million, food handlers certificates Sh300 million, Wakulima market Sh240 million, Liqour fees Sh351 million, Hospitals Sh1billion and other income Sh1.8 billion.
In the current financial year, Nairobi had a target for rates of Sh5.6 billion, single business permits Sh3 billion, parking fees Sh3 billion, building permits Sh1.8 billion, billboard and adverts Sh1.2 billion.
Others include markets Sh538.8 million, fire services Sh450 million, house rents Sh600 million, food handlers certificates Sh250 million, liquor licences Sh250 million and other income Sh1.48 billion.
According to City Hall, historically, the contribution of external revenue to the total revenue is predominantly higher than internal revenue.
However, for the next financial year, the internal revenue is projected to slightly surpass the external revenue contribution to the total revenue.
To meet the own source revenue target, it will require robust revenue mobilization strategies for specific revenue streams.
The internal revenue will constitute 51 per cent of the total projections while the internal will constitute 49 per cent of the total revenue projections.
Nairobi has been falling short of its revenue target since it came into existence in 2013 despite the digitisation of over 136 of its revenue streams.
This has been blamed on unreliable rates, low collection from single business permits and inefficient collection of parking fees.
However, in the FY 2022-23, its own source revenue hit Sh10.6 billion
It was against a target of Sh18.2 billion, which was part of the Sh38.3 billion county budget.
According to data from the Finance Department, Sh10.6 billion is the highest achieved by City Hall in the last five years.
However, MCAs have queried the Nairobi county government's revenue collection systems, demanding a probe into why City Hall continues to underperform.
In a notice of motion by Majority leader Peter Imwatok, the ward representatives formed a 13-member ad hoc committee to probe the system.
Imwatok highlighted that despite Nairobi county boasting of several revenue streams, there has been gross underperformance as regards the county's annual revenue collection vis a vis its annual county expenditure.
The committee is yet to finalise its probe.