The Mediation Committee considering the Division of Revenue Bill, 2026, has moved closer to resolving the long-running dispute between the National Assembly and the Senate over the amount of revenue to be allocated to county governments.
Meeting at Parliament Buildings on Monday, the joint committee reported significant progress after narrowing differences on both the fiscal allocation and key legal provisions within the Bill.
The talks were being co-chaired by National Assembly Budget and Appropriations Committee Chair Samuel Atandi and Senate Finance and Budget Committee Chair Ali Roba.
A major breakthrough was reached on Clause 5 of the Bill, which seeks to protect county governments from sudden expenditure cuts in the event of national revenue shortfalls.
Agreement Reached on Key County Protection Clause
Senator Roba emphasized that the provision is critical in safeguarding county operations and ensuring compliance with Article 219 of the Constitution.
“The purpose of Clause 5 is to insulate counties from arbitrary expenditure cuts due to revenue shortfalls,” he said, noting that counties do not have the same borrowing flexibility available to the national government.
Atandi confirmed that the National Assembly had agreed to reinstate the clause following consultations with the National Treasury.
The development was welcomed by lawmakers from both Houses, with Senator Tabitha Mutinda describing the agreement as a major step toward improving predictability in county budgeting and planning.
Revenue Allocation Gap Continues to Narrow
Discussions also focused on the equitable share of revenue to be allocated to counties.
The National Assembly initially proposed KSh 420 billion, while the Senate pushed for KSh 450 billion. Through ongoing negotiations, both sides have adjusted their positions.
Atandi revealed that the National Assembly had increased its offer to KSh 425 billion, citing prevailing economic realities and revenue constraints.
The Senate, meanwhile, has lowered its position to KSh 440 billion. Senator Roba argued that counties require stronger financial support to sustain service delivery and development programmes.
Senator Eddy Oketch maintained that technical assessments place the ideal county allocation at approximately KSh 445 billion, pointing to stalled projects and outstanding obligations, including Equalisation Fund arrears.
Mwengi Mutuse suggested that future revenue surpluses could be addressed through supplementary adjustments to the revenue-sharing framework, while Christopher Aseka emphasized the need for realism amid global economic pressures.
