By Billy Mijungu
The inefficiencies in county revenue collection across Kenya have long hindered service delivery and development. Corruption, leakages, and inconsistent systems have led to massive revenue losses year after year, depriving counties of the resources needed to improve infrastructure, healthcare, and public services. It is time to embrace a transformative approach that will enhance efficiency, transparency, and accountability in county finances. The introduction of the Own Source Revenue Act presents a vital opportunity to reform and standardise revenue collection, ensuring that every shilling collected is accounted for and used for the benefit of the people.
Own Source Revenue is the proverbial cost of a county lifestyle. It should be oriented towards running the county’s recurrent budget, leaving national allocations purely for development. Counties should not rely on national transfers for salaries and operational expenses while failing to maximise their own revenue potential. A well-managed county should generate enough internal revenue to cover its basic operations, allowing national allocations to fund major infrastructure projects and long-term economic growth initiatives.
One of the most pressing issues in county revenue collection is the fragmented and uncoordinated manner in which counties handle their finances. Some counties rely on outdated manual systems, while others have multiple pay points, making it difficult to track and audit collections effectively. This loophole creates opportunities for mismanagement and loss of funds. Establishing a single pay point system per county will eliminate these inefficiencies by centralising revenue collection and enabling proper monitoring. A unified approach will also simplify payments for residents and businesses, who currently navigate a confusing maze of levies and fees spread across different collection points.
Digitalisation is the backbone of this proposed reform. By integrating all counties into a centralised digital revenue collection platform, Kenya can significantly reduce corruption and improve efficiency. A digital system minimises cash transactions, which are a major source of revenue leakage, and ensures that payments go directly to county coffers. Automation also enhances transparency by providing real-time data on collections, allowing for accurate financial planning and timely allocation of resources. The convenience of digital payments will further encourage compliance among residents and businesses, increasing revenue inflows.
To ensure the success of this transformation, the establishment of County Revenue Boards is crucial. These boards will provide the necessary oversight for the implementation of the single pay point system and the digital platform, ensuring that counties adhere to standardised procedures. By including representatives from key county departments, businesses, and civil society, the boards will bring accountability and inclusivity to the revenue management process. Their role in monitoring collections, identifying inefficiencies, and recommending improvements will ensure that county revenues are managed effectively.
A structured capacity-building programme for county officials is another critical component of this reform. Many counties still struggle with financial mismanagement due to inadequate training and poor digital literacy among revenue officers. The proposed law mandates comprehensive training programmes that will equip officials with the skills needed to operate the digital system efficiently. Public awareness campaigns will also educate residents on the new system, fostering compliance and trust in county revenue processes.
The proposed law also outlines a phased implementation strategy to ensure a smooth transition. A pilot phase in select counties will allow for testing and refinement before a nationwide rollout. This measured approach will address any challenges before full implementation, reducing the risk of failure and resistance. Regular audits and independent evaluations will further reinforce accountability and identify areas for improvement, ensuring that the system remains effective over time.
With a robust enforcement mechanism in place, counties that fail to comply with the law will face penalties, ensuring adherence to the new framework. This deterrent will eliminate complacency and force counties to embrace efficient and transparent revenue collection practices. The Act also mandates the national government to allocate resources for implementation and maintenance, ensuring that counties have the necessary infrastructure to support digitalisation.
The time for reform is now. County governments must embrace the Own Source Revenue Act as a means of strengthening financial health and improving service delivery. A streamlined revenue collection system will not only boost county revenues but also restore public confidence in devolved governance. Kenya cannot afford to continue losing billions due to inefficiencies and corruption. With a clear legal framework and the right technology in place, the country can set a new standard in county revenue management, ensuring that every collected shilling contributes to development and the betterment of citizens’ lives.
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