President William Ruto has assented to two pivotal pieces of legislation aimed at strengthening financial management in Kenya’s devolved units. The County Allocation of Revenue Bill, 2025, and the County Public Finance Laws (Amendment) Bill, 2023 were signed into law at the Homa Bay State Lodge on Wednesday.

County Assembly Fund to Boost Financial Independence

The County Public Finance Laws (Amendment) Bill, sponsored by Meru Senator Kathuri Murungi, amends the Public Finance Management Act to establish a County Assembly Fund in each county. This fund will cater to administrative expenses and enable the purchase of key assets such as land and buildings.

Though the County Assembly Services Act already provides for a similar fund, the amended law introduces more detailed regulations on fund management, revenue sources, and disbursement procedures.

The Clerk of the Assembly will act as the fund administrator, ensuring the funds are safeguarded for their intended purposes, retained at the Central Bank of Kenya, and disbursed efficiently.

Unutilized funds at the end of the financial year will be rolled over into the next year, enhancing financial continuity.

Timely Disbursements and Accountability Measures

County treasuries are now mandated to release funds from the County Revenue Fund by the 15th of each month for the following month’s expenditures. Disbursements remain subject to county assembly approval to ensure proper oversight.

Proponents of the law argue that this shift will strengthen autonomy and enhance the operational effectiveness of county assemblies in fulfilling their legislative and oversight roles.

Ksh.415 Billion to Be Shared Among Counties

The County Allocation of Revenue Bill, 2025—championed by Senate Budget and Finance Committee Chair Ali Roba—sets the equitable share of national revenue at Ksh.415 billion for the 2025 fiscal year. This reflects a 7.1% increase from the Ksh.387.4 billion allocated in 2023/24.

This marks the first disbursement under the fourth revenue-sharing formula, approved by Parliament in accordance with Article 217 of the Constitution.

New Reporting Requirements for Transparency

To improve transparency in financial flows, the law requires:

• -The National Treasury to publish monthly reports on actual transfers to counties.

• -County treasuries to reflect and report these receipts in quarterly and annual financial statements.

• -Quarterly performance reports on transferred functions to be submitted to the Senate and respective assemblies.

Additionally, the law introduces budget ceilings for both county executives and assemblies, aimed at curbing fiscal mismanagement.