The National Assembly has approved the mediated version of the Division of Revenue Bill, 2026, paving the way for the equitable sharing of nationally raised revenue between the national and county governments for the 2026/27 Financial Year.
Under the approved schedule, a total of KSh 2.901 trillion in sharable revenue will be distributed between the two levels of government. The National Government will receive KSh 2.464 trillion, while the Equalisation Fund has been allocated KSh 10.25 billion. County governments will receive an equitable share of KSh 428 billion.
The mediated version also retains a key provision on revenue shortfalls and surpluses. Clause 5 of the Bill provides that where actual revenue collected during the financial year falls below projections, the resulting shortfall will be borne by the National Government.
Conversely, any revenue collected above the projected amount will accrue to the National Government and may be used to reduce borrowing or offset public debt.
The approval of the Bill is expected to provide certainty for county governments as they finalise their budgets for the 2026/27 financial year and plan the delivery of devolved services.
The allocation will finance critical county functions including healthcare services, early childhood education, agricultural extension services, county roads, water services and other devolved programmes.
