Governors have threatened to boycott future revenue-sharing talks after the National Treasury ignored their proposal and allocated counties Sh405.1 billion for the 2025/26 financial year, far below the Sh536 billion they had demanded.

The Council of Governors (CoG) said the move confirms a systematic erosion of devolution and accused the national government of reducing the Division of Revenue process to a hollow formality that disregards the real financial needs of counties.

Council Chairperson and Wajir Governor Ahmed Abdullahi said county leaders may skip future talks if their views continue to be ignored.

“It loses all meaning if the national government unilaterally decides county allocations. Our input must be meaningful, not ceremonial,” Ahmed said.

He dismissed the ongoing mediation between the Senate and the National Assembly on the Division of Revenue Bill, 2025, calling it “mere tokenism”, and accused the national government of locking counties out of key budget decisions.

Under the Bill, counties are set to receive Sh405.1 billion as equitable share for the financial year ending June 30, 2026, only Sh17.6 billion more than the current Sh387.4 billion.

This is despite a prior deal under the Division of Revenue (Amendment) Act, 2024, that had settled on Sh400 billion before President William Ruto withdrew the Finance Bill following deadly Gen Z-led protests.

Ahmed said the small yearly increases do not match the true cost of functions taken up by counties since devolution began. He noted that over the past five years, county allocations grew from Sh316.5 billion in 2020/21 to Sh370 billion in 2022 and 2023, but the burden on counties has kept growing.

He revealed that over 200 functions, worth at least Sh150 billion, have already been costed and handed over to counties without being matched by funding.
“The equitable share remains the main lifeline for counties and must reflect the full extent of devolved functions,” he said.

This year, the Council initially proposed Sh465 billion, then revised it to Sh536 billion. The Commission on Revenue Allocation recommended Sh417 billion, but the National Treasury retained its initial figure of Sh405 billion.

“At the IBEC meeting, we deliberated and revised the figure capped at Sh536 billion, but the National Treasury’s earlier proposal of Sh405 billion has been retained. It’s disappointing,” Ahmed said, referring to the Intergovernmental Budget and Economic Council, which brings together national and county officials.

The governors also blamed the Senate for failing to protect devolution, accusing it of walking away from its constitutional duty.

“The Senate has not stamped its authority... We appear before the Finance and Budget Committee, but when things go wrong, they shift the blame to governors, yet we don’t have a seat at the table during mediation,” he said.

Ahmed urged senators to reject any proposal that falls short of the costed Sh150 billion worth of devolved functions.

“Senators must reject any increment that falls below what was costed during the unbundling of devolved functions. Settling for less than Sh150 billion worth of transferred responsibilities is unacceptable,” he added.