Nairobi and Nakuru counties are the largest recipients of unpaid revenue, collectively owed Sh75.7 billion, which constitutes over two-thirds of the Sh113.3 billion in outstanding payments to all 47 counties as of June 30, 2025, according to a government report. Nairobi’s arrears alone account for 52.15% of the total, amounting to Sh59.09 billion, while Nakuru trails with 14.69%, totaling Sh16.64 billion. The figures, released in the County Governments Implementation Review Report for the 2025/26 financial year by Controller of Budget Margaret Nyakang’o, highlight systemic challenges in revenue collection across Kenya’s devolved governments.
The report underscores that Nairobi’s unpaid revenue exceeds the combined arrears of the remaining 45 counties, raising concerns about fiscal management and accountability. While the data reveals disparities in revenue collection, it also signals potential risks to service delivery and infrastructure development in counties reliant on these funds. The Controller of Budget’s office has emphasized the need for urgent interventions to address the backlog, though no specific measures were outlined in the report.
Senators have raised alarms over Sh351 million in unpaid healthcare bills in Kwale County, with Sh122 million still owed to the Kenya Medical Supplies Authority. These outstanding payments threaten the operational capacity of critical health services, exacerbating existing challenges in the sector. The issue reflects broader systemic delays in disbursements, which could undermine public trust in the efficiency of devolved governance structures.
The growing revenue arrears underscore the financial strain on counties, particularly those with limited alternative funding sources. Experts warn that prolonged delays in payments may hinder development projects and exacerbate inequalities between regions. As the national government and county administrations navigate these challenges, the focus remains on resolving the backlog to ensure transparency and effective service provision across Kenya’s 47 counties.