Nairobi could receive less funding under the latest county revenue-sharing plan, with leaders in the Senate warning that the capital stands to lose Sh1.4 billion compared to what it would have received under the previous arrangement.
Nairobi Senator Edwin Sifuna raised the concern on Tuesday, June 16, 2026, during debate on the County Allocation of Revenue Bill, saying the new formula has reduced the county’s share despite rising service delivery needs.
“The total amount that was to come to Nairobi County was Sh23.5 billion if we had gone with the old County Allocation of Revenue Act. Now it is Sh22.1 billion,” Sifuna stated.
“That is a deficit of 1.4 billion that would have come to Nairobi to help the people of Nairobi. Whereas we support this, please understand our pain on behalf of the people that we represent.”
Sifuna said the reduction comes at a time when Nairobi is under pressure to deliver services such as health, roads, and waste management, all of which require steady funding due to the city’s growing population and demands.
The Senate is considering a mediated County Allocation of Revenue Bill for the 2026/27 financial year, which sets out how Sh428 billion will be shared among counties. The framework follows approval of the Division of Revenue Bill, which was signed into law after being assented to by President William Ruto on June 15, 2026.
The Division of Revenue law raised county funding by Sh13 billion from the previous Sh415 billion allocated in the 2025/26 financial year. The amount represents about 21 per cent of the most recent audited national revenue, above the constitutional minimum of 15 per cent.
The final sharing formula was reached after mediation between the Senate and the National Assembly, after earlier disagreements on how the funds should be distributed. It takes into account population, poverty levels, land area, and fiscal responsibility.
While the overall county allocation has increased, the changes in distribution have affected how individual counties benefit, with urban counties like Nairobi expressing concern over reduced shares.
The Council of Governors had earlier pushed for Sh534 billion, citing pressure from devolved functions that remain underfunded. However, the final settlement fixed the figure at Sh428 billion.
Sifuna maintained that Nairobi’s reduction highlights the strain facing urban counties that carry heavy service delivery responsibilities.
The framework also includes Sh10.25 billion for the Equalisation Fund, aimed at reducing development gaps in marginalized areas.
Counties are now preparing for the 2026/27 budget cycle as attention shifts to how the new allocations will affect service delivery on the ground.