Description

The introduction of devolution under the Constitution of Kenya, 2010 marked a defining shift in the country’s governance and public finance architecture, giving rise to forty-seven county governments operating alongside the National Government. This constitutional reform was designed to advance equitable development, deepen democratic governance, widen citizen participation, narrow regional disparities, and bring public services within closer reach of ordinary Kenyans.

More than ten years on, revenue sharing continues to sit at the core of Kenya’s devolution project. As the financial bedrock of devolved government, it shapes how revenue collected nationally is divided between the National Government and the counties, and how that revenue is in turn distributed among the forty-seven counties to underpin service delivery, local development, and national unity.

This book traces the trajectory of Kenya’s revenue-sharing framework from 2013 through 2026. It sets out the constitutional and legal foundations of fiscal decentralization, charts the emergence of both vertical and horizontal revenue-sharing mechanisms, and examines county revenue sources, conditional grants, and the Equalization Fund, alongside the principal policy debates that continue to shape intergovernmental fiscal relations. Drawing also on relevant international experience with fiscal decentralization, the book identifies emerging issues likely to inform the next phase of reform.

Combining policy analysis with practical insight, this publication is written for policymakers, legislators, public finance practitioners, county government officials, researchers, students, development partners, and anyone seeking a deeper understanding of Kenya’s intergovernmental fiscal system.

It is my hope that this book will enrich informed policy debate and support ongoing efforts to strengthen equity, accountability, fiscal sustainability, and effective service delivery. Ultimately, revenue sharing is not simply a matter of allocating resources — it is a means of advancing inclusive development, narrowing disparities, reinforcing national cohesion, and improving the lives of all Kenyans.