By Correspondent
Siaya County is staring at one of its most severe financial crises in recent years, with nearly the entire 2026/27 budget already tied up in salaries, operational costs and unpaid bills, leaving virtually no money for new development projects.
The stark warning, issued by Francis Otiato, Member of the County Assembly representing Yimbo East Ward and a member of the Budget Committee and also Chair of the Legal and Justice Committee, painted a grim picture of a county government struggling under the weight of unrealistic revenue projections and mounting financial obligations.
Speaking while explaining the county’s budget, Otiato sought to dispel public misconceptions surrounding the approximately Sh11 billion budget, saying the headline figure masks an increasingly fragile financial reality.
“People hear that Siaya has been allocated a Sh11 billion budget and assume there is plenty of money for development. That is not the case,” Otiato said, explaining that almost all of the money has already been committed before the financial year even begins.
According to Otiato, the bulk of the county’s budget, more than Sh8 billion, comes from equitable share allocations from the National Government.
The county expects to generate approximately Sh1.1 billion from its Own-Source Revenue, while another Sh1.5 billion is projected through the Facility Improvement Fund (FIF) and Appropriation in Aid, bringing internally generated and supplementary revenues to about Sh2.6 billion. However, Otiato admitted the county’s revenue collection history raises serious doubts about these projections.
Last financial year, Siaya projected to raise Sh3.1 billion in own-source revenue after promising to fully optimise its revenue streams. Instead, actual collections fell to less than Sh1 billion, leaving the county unable to finance projects it had already budgeted for.
This shortfall resulted in a fresh burden of Sh2.1 billion in pending bills arising from the last financial year’s commitments.
These come in addition to approximately Sh1.8 billion in historical pending bills inherited from the previous county administration.
Otiato revealed that mandatory expenditures have effectively swallowed nearly the entire county budget before any development spending can be considered.
Personal emoluments alone account for approximately Sh4.7 billion, while operations and maintenance including procurement of drugs, hospital supplies, and the day-to-day running of county services consume another Sh3.5 billion. Combined, the two expenditure items account for roughly Sh8.2 billion.
When the Sh2.1 billion required to settle last year’s unfunded commitments is added, nearly Sh10.3 billion of the county’s roughly Sh11 billion budget has already been committed, leaving only about Sh700 million available for development.
According to Otiato, even that balance disappears almost immediately. The County Assembly has earmarked approximately Sh190 million for Assembly development projects, while the 30 wards have each been allocated Sh24 million, translating to Sh720 million for ward development. Together, the two allocations total approximately Sh910 million, already exceeding the available development budget.
He warned that the implication is that once Assembly development and ward projects are financed, none of the county’s ten executive departments will have resources to undertake meaningful development projects during the entire financial year.
The budget shortfall, he said, also threatens to lock Siaya out of hundreds of millions of shillings in donor and conditional grants that require counterpart funding from the county.
One such programme is the Financing Locally-Led Climate Action (FLOCA) initiative, where the county must contribute Sh77 million to unlock approximately Sh217 million in climate resilience funding.
Similarly, under the Kenya Devolution Support Programme (KDSP), the county is required to provide about Sh100 million in counterpart funding, alongside other commitments, to access more than Sh350 million earmarked for health infrastructure development.
According to Otiato, the current budget provides neither allocation, meaning Siaya risks losing substantial external development funding.
The situation extends to agricultural programmes such as KELCOP and NAV-CDP, which also require county counterpart funding before grants can be accessed.
Otiato cautioned against balancing the budget by inflating own-source revenue projections, warning that the same approach failed during the previous financial year.
“County officials could increase projected revenue on paper to create room for development spending, but if actual collections once again fall short, projects will stall and pending bills will continue to accumulate,” he said.
“The danger of running an exaggerated own-source revenue target is that the projects will eventually stall because the money will simply not be collected,” he warned.
Residents, he said, should prepare for a financial year focused largely on completing projects awarded in the previous budget and settling outstanding contractor payments rather than launching new initiatives.
Only a handful of water projects are expected to proceed, although even those are unlikely to receive full funding.
“The reality is that this financial year will largely be about settling yesterday’s obligations rather than building tomorrow’s development,” Otiato said.
