The Mediation Committee considering the Division of Revenue Bill, 2026, has made progress towards resolving differences between the National Assembly and the Senate over the equitable share of revenue allocated to County Governments.
The joint sitting, co-chaired by National Assembly Budget and Appropriations Committee Chairperson Samuel Atandi and Senate Finance and Budget Committee Chair Sen. Ali Roba, noted “tangible goodwill” as both sides moved closer to compromise on the contentious fiscal framework governing county allocations.
At the centre of the talks is Clause 5, which seeks to shield counties from abrupt budget disruptions in the event of revenue shortfalls.
“The purpose of Clause 5 is to insulate counties from arbitrary expenditure cuts due to revenue shortfalls. This clause is critical as it gives effect to Article 219 of the Constitution,” Senator Roba said, stressing that counties lack borrowing flexibility compared to the national government.
Atandi confirmed that the National Assembly had agreed in principle to reinstate the clause after consultations with the National Treasury.
“We are here to undertake a constitutional responsibility. The economy is not capable of raising sufficient revenue to meet all competing demands. We must be realistic,” he said.
On her part, Senator Tabitha Mutinda welcomed the agreement on Clause 5, describing it as a major step forward in strengthening predictability of county budgets.
On the fiscal figure, the two Houses have progressively narrowed their positions from an initial Ksh 420 billion proposal by the National Assembly and Ksh 450 billion by the Senate.
MP Atandi indicated that the House had moved its ceiling upward to Ksh 425 billion, “We have moved from Ksh 420 billion to Ksh 425 billion on our side. We believe this is factual and realistic given the revenue environment.”
Senator Ali Roba, however, maintained that counties require stronger support, proposing Ksh 440 billion as a balanced outcome, noting that both sides had already demonstrated flexibility.
“The counties will smile at Ksh 440 billion. We are aware of the economic situation, but we must still support devolution,” he said.
Senator Eddy Oketch echoed the push for stronger county financing, arguing that scientific assessment places optimal allocation at approximately Ksh 445 billion, citing stalled development projects and pending obligations including the Equalisation Fund arrears.
Other legislators, including MPs Mwengi Mutuse and Christopher Aseka, pushed for consensus noting that revenue shortfalls and global economic pressures must guide final determination.
MP Mutuse noted that allocations had risen steadily over recent years and proposed that any future revenue surpluses could trigger supplementary adjustments through amendments to the Division of Revenue framework.
In his closing remarks, Senator Ali Roba said both sides had demonstrated goodwill and agreed to adjourn to allow further consultations.
“We have made significant progress from Ksh 450 billion to Ksh 440 billion and from Ksh 420 billion to Ksh 425 billion. We adjourn and reconvene tomorrow at 1.00pm. Whatever we agree here must pass both Houses,” he said.
The Mediation Committee agreed to undertake further consultations before reconvening, expressing confidence that a consensus would be reached to facilitate the timely enactment of the Division of Revenue Bill, 2026, and ensure continued funding for county governments and national programmes.
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