White Smoke at Last: MPs Agree to Allocate Sh415 Billion to Counties in Landmark Deal

In a breakthrough for Kenya’s devolved system of government, Members of Parliament (MPs) have finally reached a consensus to allocate Sh415 billion to counties for the 2025/2026 financial year. The agreement, which ends weeks of gridlock and political wrangling between the National Assembly and the Senate, marks a significant milestone in ensuring that counties have sufficient resources to deliver essential services.

The consensus was reached late Wednesday evening during a special sitting of the Mediation Committee on Division of Revenue, which comprises representatives from both Houses of Parliament. The breakthrough comes after intense lobbying by governors, senators, and civil society organisations that had decried delayed funding and increasing pressure on counties to meet public expectations with limited financial support.

Senators had initially pushed for an allocation of Sh444 billion, citing inflation, increased devolved functions, and the rising cost of healthcare and infrastructure development. However, the National Assembly had maintained a lower figure of Sh391 billion, arguing for fiscal discipline amid tight national revenue projections. The final compromise of Sh415 billion was hailed as a win-win outcome for both sides.

National Assembly Majority Leader Kimani Ichung’wah confirmed the deal, stating: “This agreement demonstrates our commitment to strengthening devolution. We have listened to all voices—from governors to citizens—and made a responsible decision that balances national priorities with local needs.”

Council of Governors (CoG) Chairperson Anne Waiguru welcomed the deal and expressed optimism that counties would now be able to finalise their budgets and avoid service disruptions. “This is a historic step. Counties will now have a more predictable and adequate flow of funds, which is crucial for development and the delivery of essential services like health, agriculture, and education,” she said.

The Sh415 billion will be distributed among the 47 counties using the equitable revenue-sharing formula established by the Commission on Revenue Allocation (CRA). The funds will support county operations, development projects, healthcare services, water provision, and road maintenance.

However, observers warn that timely disbursement of the agreed funds will be just as important as the allocation itself. In the past, delays by the National Treasury have paralysed county operations, leading to delayed salaries, stalled projects, and frequent standoffs between county assemblies and executives.

Devolution experts have praised the agreement as a demonstration of the maturity of Kenya’s democratic institutions and a sign that the two houses of Parliament can work together in the national interest. “This moment proves that dialogue and compromise can deliver results that improve people’s lives at the grassroots,” said devolution policy analyst Dr. Leah Mutanu.

As the country moves into the new fiscal year, counties are now expected to finalise their Appropriation Bills and begin implementing their 2025/2026 development plans. The successful allocation of Sh415 billion is expected to inject life into local economies and improve service delivery to millions of Kenyans who rely on county governments for healthcare, water, agricultural support, and small-scale infrastructure development.

With this breakthrough, the promise of devolution takes another vital step forward—and for millions of Kenyans, especially in rural areas, that means better roads, clinics, schools, and livelihoods.