Vihiga County banking on digital system to enhance own-source revenue

Vihiga County Governor Wilber Ottichilo

Vihiga County Governor Wilber Ottichilo. Jointly with Nacada, Dr Ottichilo said, his county government would build a rehabilitation centre for drug addicts.

Photo credit: Lucy Wanjiru | Nation Media Group

Vihiga County is banking on the newly launched automated revenue collection method to increase its Own Source Revenue (OSR) as it aims to achieve the Sh5.9 billion annual budget target. 

The new automated revenue collection method is estimated to increase its revenue collection from Sh227 million in 2022-23 to Sh400 million by the end of 2023-2024 Financial Year.

This as the county expects its total resource envelope of Sh5.9 billion to be funded through allocation from the equitable shares as stipulated by the Commission of Revenue Allocation (CRA), locally collected revenue and conditional loans and grants.

The equitable share allocation in the 2023/24 financial year is expected to be at Sh5.2 billion compared to Sh5.9 billion of last year bringing a deficit of over Sh700 million.

Governor Wilber Ottichilo believes that the new payment system will seal loopholes for officers who have been stealing revenue during manual collection.

If well administered, the revenue from all streams will help fund the budget has a total recurrent expenditure of 68 percent at Sh4.1 billion while development has a provisional allocation sum of Sh1.9 billion which constitutes 32 percent of the budget.

The additional revenue also seeks to fund the 2023-2027 County Integrated Development Plan (CIDP).

It is estimated that the county will require an additional Sh1 billion yearly to implement the listed projects in the document. 

All county service charges will now be paid through a cashless system, mobile money, and direct banking.

Speaking when he launched the automation system, Governor Ottichilo said to achieve the full implementation of the Sh5.9 billion budget, raft measures had to be taken to increase locally collected revenue. 

In the budget report, it was proposed that there be full use of the enforcement department which will ensure that all charges due to the county are paid within the stipulated timelines.  

According to the governor, the county government plans to increase their local revenue collection in the financial year 2023/24 to over Sh400 million.

"We have digitized our revenue collection system and hope we collect enough funds for our development," said Dr Ottichilo. 

The County Government of Vihiga commissioned the automation of its source revenue collection system and mandated Sense Pay Networks Ltd to undertake the exercise.

"As a county, our performance of our source revenue has not been so encouraging over the years. We seem to have stagnated at around an annual collection of Sh200 million for long,” he said. 

The target to increase revenue is to be achieved by digitization of revenue management and collection within the County and tapping other revenue sources to ensure that the executive collects more in local revenue.

“Now, all taxes will be paid through the mobile digital transaction and bank deposit as opposed to hard cash collection that has been going on because revenue collection done manually had raised alleged misappropriation of the funds,” he said, noting that the digitised revenue collection will enhance transparency and accountability and reduce misappropriation of funds.