NAIROBI, Kenya — County governments are under mounting financial pressure following delays in the release of more than Sh68 billion in equitable share allocations by the National Treasury, raising the risk of unpaid salaries, stalled development projects, and disrupted public services.
The delayed funds include Sh33.2 billion for December and Sh35.27 billion for January, after a late November disbursement that counties only received recently.
The situation has forced several devolved units to borrow from commercial banks at high interest rates to keep operations running, while others warn of imminent industrial action by workers’ unions.
The crisis comes at a time when health workers, county staff, and other unions are issuing strike notices, compounding uncertainty around service delivery.
Nyeri Governor Mutahi Kahiga said the cash crunch has pushed his administration to the brink.
“We even struggled to afford fuel in December and were unable to pay suppliers,” Kahiga said, warning that delayed allocations could trigger strikes. “Right now, we face a looming strike by clinical officers, who have issued a strike notice, alongside the Kenya County Government Workers Union. The delay will only worsen the situation.”
He added that ordinary residents ultimately bear the cost through disrupted services.
In Makueni, Governor Mutula Kilonzo Jnr said his county has relied on bank loans to pay salaries, forcing development projects to stall.
“Even development projects have stalled because contractors cannot proceed when their raised certificates are not honoured,” Mutula said, as quoted by the Daily Nation.
Kirinyaga Governor Anne Waiguru said the November allocation enabled her county to clear salary arrears and urgent recurrent bills, including payments to Kenya Power, but warned that delays persist.
“Bursaries, school payments, and other development works have been stalled. We are hopeful the December exchequer will be released by the end of this week,” Waiguru said.
Nyandarua Governor Kiarie Badilisha raised similar concerns before the Senate County Public Investments and Special Funds Committee, describing delayed exchequer releases as a major obstacle to county operations.
In Homa Bay, Finance CEC Solomon Obiero said the county has been forced to rely on own-source revenue to maintain essential services. Governor Gladys Wanga confirmed that no equitable share funds have been received this year.
“To maintain essential services, we have had to rely on borrowing to pay salaries and meet immediate obligations. Once funds are released, we repay the loans,” Wanga said, warning that pending bills threaten contractor relationships and project timelines.
Nairobi Governor Johnson Sakaja said the capital faces unique pressure due to its large wage bill, even though it received the December allocation.
“Of the Sh1.7 billion we receive monthly, about Sh1.5 billion goes to salaries, leaving only Sh200 million for the county assembly,” Sakaja said.
Treasury officials in Murang’a confirmed that only the November allocation was received in early January, with December funds still pending.
“This means we are still waiting for the December allocation, and January is almost over. We might have to secure overdrafts to pay December salaries, which will come at a cost,” one official said.
The strain is particularly acute in coastal counties such as Taita Taveta and Tana River, where civil servants have reportedly gone nearly two months without pay. Lamu County, however, has avoided delays, according to Finance Executive Mohamed Mbwana, who said system inefficiencies have not affected disbursements.
Meanwhile, the Senate County Public Accounts Committee, meeting in Mombasa, cautioned governors against launching new projects or incurring luxury spending while pending bills remain unpaid.
“Governors must stop treating pending bills as an afterthought,” committee chair Senator Moses Kajwang’ said, citing a Senate-approved framework initiated by Senator Ledama Ole Kina to guide settlement of arrears.
President William Ruto has pledged to address delays, but governors and senators accuse the Treasury of starving counties of cash, forcing them into costly borrowing.
The Constitution requires predictability and timeliness in county funding. Article 203(1)(j) guarantees predictable revenue, Article 209 mandates timely transfers, and Section 17(6) of the Public Finance Management Act obligates the Treasury to release funds by the 15th of every month.
National Treasury Cabinet Secretary John Mbadi dismissed claims of a crisis, insisting that only two months have experienced delays.
“Some counties have already received December allocations, and all 47 will have their funds by the end of the week,” Mbadi said, adding that some counties still hold unspent balances. “The government does not have a liquidity problem unless one seeks to create one.”
Controller of Budget Margaret Nyakang’o has urged strict adherence to disbursement schedules and fast-tracking of the County Governments Allocation Act to guarantee timely releases.
Her office’s first-quarter report shows counties had Sh107.27 billion available, including Sh66.13 billion from the equitable share, Sh26.32 billion in carryover balances and Sh13.94 billion in own-source revenue.
Of the Sh55.15 billion spent, 93pc went to recurrent expenditure, leaving just 7pc for development—underscoring how funding delays continue to choke growth at the county level.
