NAIROBI, Kenya – The National Assembly has given its nod to the County Governments Additional Allocations (No. 2) Bill, a legislative move set to channel billions of shillings in conditional funds to Kenya's 47 counties during the 2025/26 financial year. The approval, announced on Tuesday, September 30, 2025, marks a pivotal moment for devolution, promising enhanced financial muscle for county-led development.

The Bill, which originated in the Senate and was subsequently processed by the National Assembly’s Budget and Appropriations Committee, is designed to fortify the devolution framework. Its primary objective is to provide counties with targeted resources, enabling them to implement priority programmes in critical sectors such as healthcare, housing, industrialisation, and infrastructure development.

Conditional Allocations: A Breakdown

Under the provisions of the newly approved law, counties are poised to access a substantial KSh 9.98 billion in conditional allocations directly from the national government. This national component is intended to support specific, nationally-aligned development agendas that require county-level implementation.

In addition to the national government's contribution, the Bill facilitates access to an even larger pool of funds from development partners, amounting to KSh 57.7 billion. These funds, often tied to specific project outcomes and reporting requirements, will further empower counties to undertake ambitious projects and improve service delivery to their constituents.

Strengthening Devolution and Service Delivery

The essence of the County Governments Additional Allocations (No. 2) Bill lies in its commitment to strengthening the devolved system of government. By providing ring-fenced funds for specific programmes, the legislation aims to ensure that resources are directed towards areas with the most significant impact on citizens' lives. This approach is expected to enhance accountability and transparency in the utilisation of public funds at the county level.

• Healthcare: A significant portion of the funds is expected to boost healthcare services, including the expansion of health facilities, procurement of essential medicines, and recruitment of medical personnel. This aligns with the national government's Universal Health Coverage agenda.
• Housing: The housing sector is another key beneficiary, with allocations aimed at supporting affordable housing initiatives and improving living conditions in urban and rural areas.
• Industrialisation: Funds directed towards industrialisation are anticipated to stimulate economic growth at the county level, fostering local industries, creating employment opportunities, and enhancing value addition to agricultural produce.
• Infrastructure: Investments in infrastructure, including roads, water projects, and energy, are crucial for unlocking economic potential and improving connectivity within and between counties.

Stakeholder Expectations and Future Outlook

The approval of this Bill has generated considerable discussion among analysts and stakeholders. While largely welcomed as a positive step for devolution, there are calls for clarity on several fronts. Stakeholders are urging the government to provide detailed timelines for the disbursement of these funds, transparent cost breakdowns for the intended programmes, and robust safeguards to ensure prudent financial management and prevent misuse of resources.

The successful implementation of the programmes funded by these allocations will be critical in demonstrating the effectiveness of conditional grants in driving development. It will also require close collaboration between the national and county governments, as well as active oversight from civil society and citizens, to ensure that the intended benefits reach the grassroots.

This legislative milestone underscores the ongoing commitment to decentralising resources and decision-making, a cornerstone of Kenya's constitutional framework. As counties prepare to receive these substantial allocations, the focus will now shift to effective planning, efficient execution, and measurable impact on the lives of Kenyans.