The Controller of Budget (CoB) has noted that Kiambu county was the best in the Own Source Revenue (OSR) collection across the country in the 2023/2024 financial year. The report notes that in the first nine months of the financial year, the OSR collections were Ksh. 3.4 billion, an increase which represents a 27.2 percent growth compared to the same period last year, when Ksh. 2.44 billion was collected. The success in growth of the OSR for Kiambu county was attributed to the implementation of the valuation roll, granting of waivers on land rates, mobilization of revenue targets and collections at the sub-county levels, including implementation of the Enterprise Resource Systems (ERP). Muranga county on the other hand collected Ksh. 1 billion, representing the county with the highest increase in own source revenue collection in the Central region. The county collected Ksh. 520 million in financial year 2021/2022 and Ksh. 682 million in the financial year 2022/2023. OSR is important for county growth and development as evidenced by the planned annual OSR conference planned in Nairobi in next week of June 2024, which will explore the challenges facing counties OSR collection systems and the appropriate solutions.
The 14 functions assigned to counties as per schedule iv part ii of the constitution of Kenya, 2010, are broad based and require innovative and diversified means and methods of funding, beyond the allocations and transfers from the national government. There is need to expand, plan, accelerate growth, reinvigorate and improve the efficiency of urban areas because they are engines of growth and development, including aggregating and concentrating activities therein to increase the revenue bases for counties. No country can achieve higher income status without being over 50 percent urbanized.
County OSR are an important source of funds for generating additional capital beyond the allocations from the national government to fund their operations. OSR can be sourced from imposition of property tax, entertainment taxes, other taxes authorized by an Act of Parliament, charges for services provided by counties, which calls for the creation and provision of more broad range of services for increased revenue generation; leveraging on their natural resource base and potential through publicity, awareness creation and promotion of counties as investment destinations and tapping the untapped potential therein. Kenyan counties have a lot to offer and hence competitive advantage which can be turned into revenues generating activities. The Commission for Revenue Allocation (CRA) has unveiled a guide to help counties raise more revenues through a policy model outlining the basis for levying tariffs, fees and charges. Dr. Mutegi Giti, Urban management, Public Private Partnerships (PPPs) & Environment Specialist. mutegigiti@gmail.com, @danielgiti.
Dr. Daniel Mutegi Giti 