County revenue collections fall Sh1.9bn on Covid woes

CoG chair Wycliffe Oparanya

Council of Governors chair and Kakamega Governor Wycliffe Oparanya addresses journalists at Prosperity House in Kisumu County on September 16, 2020.

Photo credit: Tonny Omondi | Nation Media Group

Internal revenue collection for counties in the three months to September fell Sh1.86 billion compared to a similar period last year in the wake of the Covid19 that disrupted businesses and led to travel bans.

Controller of Budget (CoB) data shows that the devolved units raised Sh5.85 billion in the period under review down from Sh7.71 billion in three months to September last year.

The report shows none of the counties raised at least a quarter of its annual own-source revenue (OSR) target increasing fears that they will once again miss on their ambitious revenue targets for the year to next June.

The fall came in the wake of Covid-19 restrictions that forced motorists to stay home and banned foreign and international flights.

Spending review

Controller of Budget Margaret Nyakang'o said the devolved units should review their spending plans to match the under-collections and ensure that the provision of basic services is not hurt.

"Counties are urged to monitor the performance of own-source revenue mobilisation with a view of making budget adjustments during the supplementary budget process," she said in the report.

Nandi County recorded the biggest drop as the collections dipped 92 per cent to Sh4.59 million from Sh57.89 million raised in the corresponding period last year.

Narok County, which mainly relies on the Maasai Mara Game Reserve for its revenue, had the second-biggest drop of 86.5 per cent to collect Sh168.1 million from Sh1.243 billion in a similar period last year, highlighting the dire effects of the Covid-19.

Counties raise own-source revenues from streams that include parking fees, market rates, single business permits, entertainment, and property rates.

Basic services

The dismal collections hurt the ability of counties to offer basic services like health in a period that National Treasury failed to release part of the equitable share of revenue due to delays in the passing of the revenue sharing formula.

Parliament passed the formula in October paving the way for the National Treasury to release the first tranche of the Sh316.5 billion and averting a possible shutdown of the counties.

Counties have since the start of devolution failed to meet their annual revenue targets. This is due to weak resources to nab defaulters, the use of outdated land valuation rolls, which do not match the increase in market prices for property and corrupt revenue officials.

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