Commision on Revennue Allocation

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    Enhancing Administrative justices&Access to Information during an Electoral Period
    (2023-02-15) Commission On Administrative Justice
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    Division of Revenue Bill 2023
    (2/15/2023) The National Treasury and Economic Planning
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    County Governments Additional Allocations Bill, 2023
    (2023-02-15) The Nationa Treasury and Economic Planning
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    County Allocation of Revenue Bill 2023
    (2023-02-15) County Allocation Of Revenue Bill
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    Second Policy on Revenue Sharing among Marginalized Areas
    (2019) Commission on Revenue Allocation
    The Constitution of Kenya (2010) established the Equalisation Fund which is allocated one half percent of nationally raised revenue, computed on the basis of the most recent audited approved accounts of revenue. The Equalisation Fund (EF) became operational in the financial year 2011/12 following the promulgation of the Constitution in 2010. The Fund is used to improve basic services that relate to water, health, roads and electricity- among others, in marginalised areas. The Constitution further entrusts the identification of marginalised areas and determination of a criteria for sharing revenues from the Equalisation Fund to the Commission on Revenue Allocation (CRA). The Commission prepared the first three-year policy in 2013, which identified fourteen marginalised counties and allocated Kshs 11.8 billion from the EF to these counties. The first policy lapsed in the FY 2016/17. This is the second policy prepared by the Commission, in pursuit of this mandate. Invoking the principle of equity, this second policy recognizes that there are pockets of extreme marginalisation even in prosperous places. Therefore, this policy adopted a new approach to identify marginalised areas. In this policy, the Commission has moved beyond identifying marginalised counties and instead, determined specific areas using sub-locations where marginalised communities live. This approach is expected to ensure that resources meant to improve services in lagging areas are properly targeted for the realization of maximum impact. In this regard, guided by the provisions of Article 204, this second policy used indicators on access to education, water, sanitation and electricity to construct an index of deprivation. This index is used to rank 7,131 sub-locations from the lagging areas to the most prosperous. A total of 1,424 sub-locations, the bottom 20 percent where about 5 million Kenyans live, have been identified for funding from the Equalisation Fund. The policy also identifies four marginalised minority communities that need to be targeted for service provision, namely; Elmolo, Makonde, Watta and Dorobo-Saleita. The policy has formulated an index for sharing the funds among the 1424 sub locations. This policy recommends the fostering of partnerships through matching funds, where appropriate, along with the involvement of county governments, local administration and beneficiary communities in the selection and implementation of projects, among other recommendations. It is the hope of the Commission that the implementation of this second policy will improve access to basic services for the bottom 20 percent and that no Kenyan will be left behind.
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    Report on Costing of Government Functions (Nov 2015)
    (2015) Commission on Revenue Allocation
    I wish to take this golden opportunity to thank all those who have, in one way or the other, contributed to the preparation of this report which will immensely contribute to the effective determination and allocation of resources for performance of national and county. Much gratitude goes to the Chairman, Mr. Kinuthia Wamwangi (EBS), Comm. Rose Osoro of CRA, the TA Members including Mrs. Angeline Hongo MBS, Mr.Simeon Pkiyach, Mrs. Mary Ndeto, HSC, Mr. Bakari Omara, Ms.Safia Abdi, Mr. Erastus Rweria, MBS and the Chairman of Functional Analysis and Competency Assignment Committee Dr. Dabar Abdi Maalim. I cannot forget to acknowledge the technical support rendered by our core secretariat comprising of Mr. Mahat Shalle, Mr. Ndungu Njoroge , Ms. Maggy Mwangangi, Mr. Adan Ali, Mr. Policarp Odoul, Ms. Grace Kimitei, John Mose, Ms. Meimuna Mohammed, Job Otiwa, Ms. Margaret Chebii and Mr. Adan Ali. Further, I wish to thank the UNES Consulting team led by Dr. Julius Korir for their unwavering commitment to completion of the exercise Lastly, I also wish to acknowledge the vital role played by the technical committee officers from all the ministries and sectors in the pilot exercise and all the other stakeholders who participated in the consultative sessions and seminars that produced those vital documents that informed this report.
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    Recommendation on Recurrent Budget Ceilings for 2019-2020
    (2019) Commission on Revenue Allocation
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    Recommendation on Basis for Equitable Sharing of Revenue between National and County Governments (2018-2019)
    (2019) Commission on Revenue Allocation
    Pursuant to Article 216 (1)(a) of the Constitution of Kenya 2010, the Commission on Revenue Allocation is mandated to make recommendations concerning the basis for equitable sharing of revenue raised by the national government between national and county governments. Article 216 (5) requires the Commission to submit such recommendations to the Senate, National Assembly, the National Executive, County Assemblies and County Executives. Accordingly, the Commission recommends that for financial year 2018/2019, Kshs. 1,371.2 billion and Kshs.337.2 billion be allocated to national and county governments respectively, as equitable shares. The Commission further recommends that Kshs. 30.5 billion be allocated from the national government equitable share to counties as conditional grants. The equitable share of revenue for each county government for financial year 2018/19 has been included in this document as Table 11. These county allocations are based on the second basis for revenue sharing among county governments approved by Parliament in 2016.
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    Recommendation Concerning The Third Basis for Revenue Sharing Among County Governments
    (2019) Commission on Revenue Allocation
    The third basis for equitable sharing of revenue among county governments has been prepared in accordance with the provision of Article 216 (1) (b) of the Constitution of Kenya, which mandates the Commission on Revenue Allocation to make recommendations concerning the basis for the equitable sharing of revenue raised nationally among the county governments. Further, Article 217 (2) (b) stipulates that in determining the basis of revenue sharing, the Senate shall request and consider recommendations from the Commission. In accordance with Article 217(1), this basis will be used to share revenue among county governments for the next five financial years, from 2019/20 to 2023/24. This recommendation was formulated through a consultative process involving local and international experts, and the public. The recommendation is also informed by lessons from a comparative analysis of financing transfer systems in jurisdictions with a fiscal architecture similar to Kenya’s, and a comprehensive review of the second basis which was considered transitional. This recommendation is anchored in a revenue sharing framework which seeks to closely align funding to functions assigned to county governments to enhance service delivery. The framework also takes into account the need to address developmental gaps and economic disparities among counties. In addition, the framework seeks to create incentives for county governments to adhere to principles of fiscal responsibility and to optimize their capacity to raise own revenue. On implementation of the third basis, the Commission recommends a phasing-in of the formula to avoid disruption in service delivery and development programs. The proposed approach is to set aside 15 percent of the equitable share increment to cushion counties which would see a reduction in the quantum of their equitable share in excess of 5 percent.
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    Proposed 3rd Revenue Allocation Formula
    (2020) Commission on Revenue Allocation