Delayed cash main hurdle as Governors outline devolution successes

Delayed Exchequer disbursements, dwindling donor support and persistent pending bills have emerged as the most significant challenges facing counties, even as governors highlighted devolution gains in the past financial year.

In the Annual State of Devolution Address delivered on Thursday, Council of Governors chairperson Ahmed Abdullahi detailed achievements across devolved functions, while acknowledging financial bottlenecks that hampered service delivery.

“Despite the strides made, service delivery was hindered by delays in exchequer releases and fluctuations in donor funding,” Abdullahi said.

The Wajir governor revealed that counties went for months without receiving funds from the National Treasury, crippling operations and basic services. 

He noted that pending bills across counties had reached a staggering Sh172.51 billion, with Nairobi alone accounting for Sh115.69 billion – nearly 70 per cent of the total.

“The accumulation of pending bills is largely due to delays in disbursement of funds by the National Treasury,” he said.

Abdullahi articulated successes in finance, agriculture, energy, water, health, trade and transport among other devolved functions.

In health, the CoG boss disclosed that some 24.4 million Kenyans have been registered under the Social Health Insurance Authority, giving them access to free services at Primary Health Care facilities.

As at the close of 2024, 9,365 public health facilities (78 per cent) have been empanelled – 594 more than under the National Health Insurance Fund. 

Public facilities have received Sh12.7 billion out of the Sh35.66 billion disbursed under SHA, with the rest going to private (48.8 per cent) and faith-based (15.6 per cent) providers.

Under the Primary Health Care Fund, Sh5.9 billion has been paid, with 54 per cent going to public facilities.

“Despite improved disbursement, some PHC facilities have yet to receive payments after submitting claims,” Abdullahi said.

An additional 1,544 licenced facilities still lack tablets needed to process claims, prompting the Ministry of Health to fast-track their distribution.

The CoG is also seeking Sh7.8 billion annually from the ministry to transition 8,287 UHC staff to county payrolls under terms approved by the Salaries and Remuneration Commission. 

Counties also received 8,316 tablets to support health digitisation – enhancing information systems, patient registration and claims processing.

In agriculture, the sector's Gross Value Added increased by 4.4 per cent to Sh1.71 trillion, though this was a slowdown compared to the previous year's 7.1 per cent growth. 

The sector created over 308,000 new jobs, 14.1 per cent being private sector employment and 90 per cent of these jobs in the informal economy.

Marketed agricultural earnings rose by 7.2 per cent to Sh690 billion, driven by strong performance in key value chains. Livestock earnings grew by 17.2 per cent, while crop earnings rose by 2.7 per cent.

Notable gains were seen in sugarcane (+68.7 per cent), milk deliveries (+12 per cent), coffee exports (+48.6%) and avocado production (+34 per cent), supported by initiatives like the Bottom-Up Economic Transformation Agenda.

Farmer training and extension services were also significantly scaled up, with over 102,000 farmers trained and advisory coverage extending to over 6.5 million farmers, reflecting strong county-level commitment to boosting agricultural capacity and resilience.

“However, challenges persisted: maize production declined slightly, horticultural exports dropped by 14.1 per cent in volume, resulting in a Sh20 billion income loss, and agricultural credit grew only marginally,” he said.

In transport, the counties tarmacked 298km of roads, constructed 4,800 km of cabro roads, gravelled nearly 12,000km and added 1,949km of non-motorised transport pavements to improve pedestrian safety.

“To support public transport, counties built 17 bus parks and over 16,000 boda boda sheds. Road safety efforts included forming 27 multi-agency county committees,” he said.

Additionally, the devolved units strengthened technical capacity by hiring over 200 engineers, 900 traffic marshals and bringing in 2,053 interns and attachés.

The county governments constructed 75 new markets, down from 117 the previous year, while 129 were renovated – up from 113 – showing a focus on upgrading rather than expanding. Trade licenses issued rose by 66 per cent, from 506,855 to 842,931, reflecting increased business formalisation.

MSME support grew, with 60,020 enterprises trained, nearly double the previous year, on key topics like registration, finance and identifying business opportunities.

In the Lands, housing and urban development sector, 19 governments had approved County Spatial Plans, with Murang’a being the latest addition.

In parallel, efforts to digitise land records and processes have continued, with five more counties: Makueni, Homabay, Kitui, Narok and Machakos, adopting the County Land Information Management System.

Makueni county stands out for fully digitising its land services into a single platform.

In support of the national affordable housing agenda under Beta, counties partnered with the national government to launch affordable housing projects, contributing land and engaging in planning efforts.

In 2024, enrolment in pre-primary education across Kenya increased by 3.88% to 2,953,207 learners, with boys accounting for 1,494,920 and girls 1,458,287.

“This rise is linked to enhanced support and investments from county governments,” he said.

The number of pre-primary schools grew by 2.95% to 48,721 and over 5,950 new classrooms were constructed within the year.

Teacher recruitment also improved, with 78,101 teachers employed by counties (up from 50,104) and 27,997 by private providers, resulting in a better pupil-teacher ratio of 37:1.

County governments collectively allocated Sh9.2 billion to education, with about Sh6.8 billion directed specifically to pre-primary education, averaging Sh3,240 per learner.

To address unemployment and skills gaps, county governments managed 1,222 Vocational Training Centers in the last financial year, up from 1,204, with enrolment rising to 172,527 trainees. 

They employed 4,874 vocational trainers, an increase from 4,797. Counties invested Sh2.45 billion in the sector, including Sh1.35 billion for construction, rehabilitation and equipment of training centers.

INSTANT ANALYSIS

During the reporting period, county governments allocated Sh1.29 billion to gender-responsive programming, a 40.62 per cent increase from the previous year. These funds supported GBV prevention and response, empowerment initiatives and the establishment of shelters and recovery centers. A total of 11,630 women and 8,802 men benefited from Access to Government Procurement Opportunities (Agpo). Additionally, 44 counties developed or reviewed gender-related laws, including empowerment funds (24 counties), SGBV policies (31 counties), and anti-FGM frameworks (5 counties).