NAIROBI, Kenya — President William Ruto has signed into law the Division of Revenue Bill and the County Allocation of Revenue Bill, 2025, formally locking in Sh 415 billion in equitable revenue allocations to Kenya’s 47 counties for the Fiscal Year 2025/26.
This marks a Sh 27.6 billion increase over the Sh 387.4 billion allocated in the previous year.
The allocation emerged from a compromise facilitated by a parliamentary mediation committee that brokered an agreement between the National Assembly and the Senate, settling on the Sh 415 billion figure 4.8pc increase over the National Treasury’s initial Sh 405.1 billion proposal.
“We have increased the equitable share of revenue to Sh415 billion among our 47 Counties, representing a rise of almost Sh30 billion from the previous financial year’s Sh387.4 billion.”
“The significant increase in the funds underpins our commitment to mobilising more resources to support devolution and boost service delivery to the people at the grassroots.”
Under the new law, the national government retains the majority of revenue, receiving about Sh 2.332 trillion, while the Equalization Fund has been allocated Sh 9.6 billion to support historically marginalized counties.
The County Allocation of Revenue Bill, 2025 provides the legal framework to guide transfers, laying out the equitable share per county and enforcing ceilings on recurrent spending for county assemblies and executives, intended to promote fiscal discipline and accountability.
The new revenue-sharing model, approved under the Fourth Basis for Revenue Sharing, combines baseline allocations, affirmative allocations for marginalized counties, and weighted parameters to distribute resources more equitably over five years.
As a result of the president’s assent, counties can now proceed with detailed budgeting and planning.
The increased funds are expected to bolster development across sectors such as healthcare, infrastructure, and public service delivery, potentially delivering more tangible results at the grassroots level.
