Ruto Signs Division of Revenue Bill Into Law
President William Ruto has approved the Division of Revenue (Amendment) Bill, 2024, which will grant counties Sh387 billion as their equitable share for the 2024-25 financial year. The original Finance Bill, of 2024, allocated Sh400 billion to devolved units, but its rejection led to a downward revision of the figure to Sh380 billion.
The Bill aimed to amend the Division of Revenue Act, 2024, to adjust how revenue raised nationally is shared between the National and county governments, in response to the downward revision of projected ordinary revenue collection for the 2024/25 fiscal year.
It was approved by the National Assembly on August 7, before being sent to the Senate, which passed it with amendments on October 3.
On October 16, the National Assembly rejected the Senate’s amendments, prompting the formation of a mediation committee to resolve the deadlock.
The 18-member committee, co-chaired by Kiharu MP Ndindi Nyoro and Mandera Senator Ali Roba, reached an agreement on Tuesday, which added Sh7 billion to the counties’ allocation.
Before finalizing the agreement, the committee considered various factors, including the reasons behind the Sh5 billion reduction in county allocations compared to the previous year, and the expected revenue shortfall of Sh346 billion.
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The committee also reviewed the criteria used to determine revenue projections and discussed how much funding should be allocated to counties.
Furthermore, they analyzed historical national government revenue projections and the performance of counties in generating local revenue.
The increased allocation to counties now accounts for 24.67% of the most recent audited revenue, significantly surpassing the constitutional minimum threshold of 15%.
The Act also allocates Sh2.2 trillion to the National Government.
The signing ceremony at State House was attended by Deputy President Kithure Kindiki, National Assembly Speaker Moses Wetang’ula, Senate Speaker Amason Kingi, Prime Cabinet Secretary Musalia Mudavadi, Treasury Cabinet Secretary John Mbadi, and leaders from both Houses.
In addition, Ruto signed the Rating Bill 2022 and the Water (Amendment) Bill, 2024.
The Rating Act, of 2024, establishes a standardized framework for property valuation and rating, offering counties clear guidelines on assessing property values and imposing rates.
Meanwhile, the Water (Amendment) Act, 2024, facilitates Public-Private Partnerships to fund the development of water works by National Government Agencies.
Ruto Signs Division of Revenue Bill Into Law
