- The current formula, the third since the advent of devolution in 2013, expires in 2024-25 financial year.
- Preparation of previous formulas has been emotive with different players pulling the strings to their end.
Image: FILE
The Commission on Revenue Allocation has started the emotive preparation of the fourth revenue sharing formula among counties.
The commission has invited the public to submit views to inform the development of the next basis for sharing revenues raised nationally among the 47 county governments.
“The Fourth Basis will be used to share revenues for five financial years 2025-26 to 2029-30,” the commission said in the notice published on its website.
The current formula, the third since the advent of devolution in 2013, expires in 2024-25 financial year with the new basis expected to be approved by December next year.
The third basis has been in place since 2020-21 fiscal year.
“In exercising the principle of openness and public participation in financial matters (Article 201(a)), the Commission seeks to collect views from stakeholders,” the notice states.
“This will inform the preparation of the Fourth Basis for Revenue Sharing."
Preparation of previous formulas has been emotive with different players pulling the strings to their end.
Leaders from populous regions have been pushing for a formula pegged on population, commonly known as one man, one shilling basis.
“I support one man, one vote, one shilling in equitable share allocation, Central Kenya is suffering,” Kirinyaga Governor Anne Waiguru said last week.
However, less populous regions, especially those from expansive areas, have rejected the proposal and demanded the allocation based on physical distance.
The approval of the third formula was marred by chaos and standoffs in the Senate with senators whose counties were set to lose cash vehemently opposing it.
Ten consecutive sittings failed to strike a deal on the formula.
It took the intervention of former President Uhuru Kenyatta to increase the allocation to counties from Sh316 billion to Sh370 billion to ensure no county lost funds in the final formula.
“This formula brings to rest a long protracted, winding, noisy and messy debate in the House that has now come to an abrupt end,” former Bungoma Senator Moses Wetang'ula who chaired an ad-hoc panel formed to harmer a deal on the formula said.
The third basis of sharing revenue takes into account eight parameters: Basic share (20 per cent), Population (18 per cent), Health (17 per cent), Poverty Level (14 per cent), Agriculture (10 per cent), Roads (eight per cent), Land (eight per cent) and Urban (five per cent).
“The implementation of the Third Basis provides that Sh158.25 billion of the equitable share allocation to county governments be shared among the counties based on the aggregate allocation ratio of the Second Basis,” CRA said.
“The balance of the equitable share allocation to county governments is shared based on the allocation ratio of the Third Basis.”