In a major move for Kenya’s devolved governance, President William Ruto has officially assented to the County Allocation of Revenue Bill, 2026, unlocking a record Sh428 billion in equitable share funding for the country’s 47 county governments. The announcement, made on June 29, 2026, places Nairobi and Nakuru counties among the primary beneficiaries of the multi-billion shilling distribution.
This new funding package represents a notable financial step forward for local administrations. The Sh428 billion allocation is an increase of Sh13 billion from the Sh415 billion allocated to counties in the 2025/2026 financial year. It is equivalent to 20.9 per cent of the most recent audited national revenue for the 2022/23 financial year, exceeding the constitutional minimum allocation of 15 per cent under Article 203(2).
President Ruto assented to the Bill at State House, Nairobi, during the 11th Presidential Assent of 2026, giving legal effect to the distribution of county governments’ share of nationally raised revenue under the Division of Revenue Act, 2026. The strategic move by the presidency to release these funds is designed to support county operations and strengthen devolution.
Nairobi stands out as the top beneficiary, receiving the biggest share of Sh22.1 billion under the newly enacted Act.
Nakuru follows as the second-highest beneficiary with Sh14.9 billion.
Other counties among the top recipients include:
- Turkana – Sh14.3 billion
- Kakamega – Sh14.1 billion
- Kiambu – Sh13.5 billion
As key economic hubs, Nairobi and Nakuru will see their local programmes supported by the newly unlocked Sh428 billion, which expands on the previous year’s Sh415 billion budget.
The Sh13 billion funding boost highlights the evolving financial relationship between the national executive and county leadership. Under the allocation formula, Sh387.43 billion will be distributed through a Baseline Allocation linked to what counties received in the 2024/25 financial year to protect them from sudden funding reductions. A further Sh4.46 billion has been set aside as an Affirmative Action Allocation for 12 historically marginalised counties to help bridge development gaps. The remaining Sh36.1 billion will be shared using a weighted formula that considers population, poverty levels, income distance and geographical size, directing additional resources to counties with greater development needs.
Of the amount distributed through the formula, 35 per cent will be shared equally among all counties, 45 per cent based on population, 12 per cent according to poverty levels and eight per cent based on geographical size, with the land area component capped at 10 per cent.
President Ruto stated: “The formula provides a stable baseline allocation while ensuring a fair distribution based on equal share, population, poverty level and geographical size. The enhanced allocation will strengthen devolution by equipping county governments with the resources they need to fulfil their constitutional mandate and deliver quality services in line with their budgets and development priorities”.
The law also introduces measures aimed at improving financial management and accountability at the county level. It sets budget ceilings on recurrent expenditure for county executives and county assemblies to help contain rising wage bills and leave more funds for development projects. Additionally, national government entities taking over devolved functions will be required to submit quarterly reports to both the Senate and the affected county assembly detailing the status of service delivery.
The Bill was sponsored by the Senate Standing Committee on Finance and Budget Chairperson Ali Roba. It was passed by the Senate with amendments on June 17 before being approved by the National Assembly without further changes on June 25, then forwarded to the President in line with Article 110(5) of the Constitution.
With the funds now unlocked by President Ruto, attention shifts to how Nairobi, Nakuru, and other counties will manage the Sh428 billion to deliver services and implement development programmes aimed at improving livelihoods, creating economic opportunities and enhancing access to public services.
This fiscal transition from the 2025/2026 financial year budget of Sh415 billion to the current Sh428 billion marks a crucial moment for county planning. The timely release of these funds remains central to sustaining operations across all devolved units.
Ultimately, the successful unlocking of the Sh428 billion by President Ruto ensures that counties can transition smoothly into their next operational phase, building directly on the foundations laid during the previous Sh415 billion funding cycle.
📄 Disclaimer
This article is based on publicly available information from official government communications, project reports, and credible media sources. While every effort is made to ensure accuracy, project details such as timelines, costs, and implementation status may change over time.
