How much money does Nairobi County say it will raise from its Own Source of Revenue in FY 2019/2020 and is that reasonable?

  • Gibson Kerosi
  • 3rd June 2019
  • Comments Off on How much money does Nairobi County say it will raise from its Own Source of Revenue in FY 2019/2020 and is that reasonable?
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How much money does Nairobi County say it will raise from its Own Source of Revenue in FY 2019/2020 and is that reasonable?

Nairobi County is planning to Raise Ksh. 17.3 billion from Own Sources of Revenue (OSR) in Financial Year 2019/2020. The question is whether this is reasonable.  

The Office of Controller of Budget annual report for Nairobi County for FY 2017/2019 can be a good indicator on whether Ksh. 17.3 billion is a reasonable target for financial year 2019/2020.

According to the Annual report for FY 2017/2020, Nairobi County had a target of raising Ksh. 17.23 billion an equivalent of 51.2% of the total budget from own source of revenue. However, the county was only able to raised Ksh. 10.11 billion (actual). This means that the target was missed by a whopping Ksh. 7.12 billion. This is the real budget deficit which is usually hidden at the time of formulating the county budget.  

To further strengthen my argument allow me to take a look at the half year budget implementation reports from Office of Controller of budget. This is the most recent available implementation reports considering that the year is not yet over and hence no annual implementation report is available for the entire FY 2018/2019.

Read More: Nairobi County Liquor licensing Board

In FY 2018/2019, Nairobi County is planning to raise Ksh. 15.21 billion or 46.2% from Own Source of Revenue (OSR). This sounds more realistic compared to that of FY 2019/2020. However, the implementation reports indicate that by half year, Nairobi County had just raised Ksh. 3.88 billion.

In comparison, during the first half of FY 2017/2018, Nairobi County raised Ksh. 3.11 billion out the annual target of Ksh. 19.77 billion. This is one of the years when the county resorted to setting overambitious targets on local revenue.

The above examples clearly show that Nairobi County has a tendency of setting overambitious targets for its Own Source of Revenue. If this is not managed, it will always lead to budget deficits.

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Gibson Kerosi

Gibson Kerosi is a prolific Kenyan writer and a Teacher based in Nairobi Kenya. He is a Bachelors of Education (Arts) graduate from The University of Nairobi.

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