NAIROBI, Kenya, Dec 11 – The National Treasury has been compelled to withdraw the Public Finance Management (Amendment) Bill, 2025 from Parliament, pausing a critical review of rules governing county funding, following a directive from the National and County Governments Coordinating Summit.
The decision was made at the 12th Ordinary Session of the Summit on December 10, 2025. The bill sought to amend sections 191A-E of the 2012 Public Finance Management Act, aiming to split the County Governments Additional Allocations Bill into two separate laws to expedite the release of funds to counties.
“The Public Finance Management (Amendment) Bill seeking to review section 191A-E of the Public Finance Management Act, 2012 shall be withdrawn from Parliament by the National Treasury to pave way for further consultations,” the Summit communique stated.
Sections 191A-E were initially enacted to allow county governments access to their minimum equitable share of revenue in case of delays in passing the Division of Revenue Act, serving as a safeguard against financial paralysis for devolved units.
Last month, the Cabinet approved the legislative amendment to address recurring delays in disbursement of additional funds to counties—often caused by discrepancies between the National Assembly and Senate figures.
The County Governments Additional Allocations Bill covers conditional and unconditional allocations, including funds from the Road Maintenance Levy Fund and development partners. The Cabinet noted that the reform would enhance efficiency in public finance management, improve service delivery, and strengthen devolution by ensuring timely fund transfers.
Earlier this year, delayed disbursements pushed 47 counties to the brink of shutting down essential services. The Council of Governors (CoG) accused the Treasury of failing to release Sh63.6 billion in equitable share revenue.
“These delays are a violation of the law and a direct threat to devolution,” said CoG Chairperson and Wajir Governor Ahmed Abdullahi.
The impasse stemmed from prolonged debates over the Division of Revenue (Amendment) Bill, 2024, with the Senate approving Sh400.1 billion for counties while the National Assembly insisted on a lower figure, delaying the County Allocation of Revenue Act five months into the 2024/2025 financial year.
