By Habil Onyango
The County Government of Homa Bay has reduced its 2026/2027 budget estimates by 0.7 per cent compared to the printed estimates for Financial Year 2025/2026.
This follows the County Assembly’s approval of Ksh12,104,350,747 for the 2026/2027 Financial Year revenue estimates, compared to Ksh12,185,176,905 for the last Financial Year.
In the estimates, 69.4 per cent, which translates to Ksh8,404,043,481, has been set aside for Recurrent Expenditure, while another Ksh3,700,307,266 for Development Expenditure represents 30.6 per cent of the total estimates.
Ksh740 million has been allocated for Ward-Based Projects, which will be distributed equally at Ksh18.5 million per ward. The allocation targets key development sectors such as healthcare, education, water infrastructure, and agriculture.
Further, the County has set aside a total of Ksh405,708,043 towards mitigation of verified pending bills.
This revenue is expected to be mobilised from equitable share allocation, own source revenue, conditional grants, Appropriations-in-Aid (A-I-A), and other revenue streams.
According to the County Assembly Budget Committee Chair, Titus Asiago, the MCA for Ruma Kaksingri Ward, the reduction is directly mandated by changes in the approved Senate legislations.
The legislations include the Division of Revenue Act (DORA), 2026, the County Government Additional Allocation Act (CGAAB), 2026, and the County Allocation Revenue Act (CARA), 2026.
They significantly reduced the conditional grants from Ksh1,646,539,167 to Ksh1,305,104,867, which is nearly a 21 per cent slash to conditional grants that has impacted the targeted ceiling. An increase of Ksh504,355,696 from other revenue variables cushioned the overall budget impact, keeping the total revenue framework constrained at 0.7 per cent.
This is according to the report by the Budget and Appropriation Committee on the consideration of the Homa Bay County Budget Estimates for FY 2026/2027.
“We recognise that this is the last budget estimate to be implemented under the first-term administration of Her Excellency, Governor Gladys Nyasuna Wanga,” said the Chair when he presented the budget before the House.
“While the administration may not have achieved 100 per cent attainment of goals in the County Integrated Development Plan (CIDP), there is no doubt that the achievements so far recorded are impressive, under the general circumstances of the existence of her government,” he said.
“In line with the above, the County Government has constantly strengthened its internal financial base and focused on key sectors such as Healthcare, Education, Water, Infrastructure and Agriculture,” added Asiago.
Further, the County Government has prioritised the settlement of pending bills arising from completed works and services.
“Adequate provisions have been made in the FY 2026/27 budget to clear verified obligations, thereby improving liquidity for suppliers and contractors and restoring confidence in County procurement processes,” reads the report.
“In aligning expenditure priorities with available resources, the County Government is committed to matching its spending with realistic resource forecasts and improving own source revenue forecasting to avoid over-projection, thereby preventing further accumulation of pending bills,” reads the report.
“The County Treasury should establish realistic work plans, streamline its procurement process, and enforce quarterly expenditure review to shift from having huge unspent balances tied to the development expenditure component of the budget,” the committee noted.
The Committee further advised the County Executive Committee to undertake continuous payroll audits to uncover irregularities, to enable the county government to comply with the 35 per cent threshold on the wage bill, as this leaves reduced funds for development projects.
Own Source Revenue (OSR)
The County projects it will generate a total of Ksh1,671,087,323 from Own Source Revenue, comprising Ksh1,104,906,565 from the health sector Appropriations-in-Aid (A-I-A), mainly derived from user fees and reimbursements under NHIF/SHA.
“These funds are expected to support service delivery within health facilities and reduce reliance on exchequer releases for operational expenditures in the health sector,” the committee noted.
Another Ksh566,180,758 is expected from Ordinary Own Source Revenue streams, including fees, charges, and miscellaneous income collected by various departments.
Ordinary Own Source Revenue, on the other hand, refers to revenues generated locally by the County Government through taxes, levies, fees, charges, rents, fines, penalties, and other legally authorised collections.
“These revenues are critical in enhancing fiscal autonomy, supplementing the equitable share from the National Government, and financing service delivery at the county level,” noted the committee.
According to the report, expenditure in FY 2026/27 is focused on key county programmes aimed at improving healthcare, expanding access to education, enhancing infrastructure, promoting food security, and strengthening governance and service delivery systems.
“The prioritisation of these programmes aligns with the CIDP 2023–2027 and reflects the County Government’s commitment to inclusive and sustainable development,” noted the committee.
