NAIROBI, Kenya, MAR 10 — Nairobi, Kisumu, and Nakuru cities are among the counties with the lowest absorption rates of their development budgets, a report from the Office of the Controller of Budget (OCOB) has revealed.
According to the First Half County Governments Budget Implementation Review Report for the 2024/25 financial year, which covers the period from July to December 2024, Mandera achieved the highest absorption rate at 32%.
This was followed by Narok (30%), Garissa (28%), Uasin Gishu (27%), and Marsabit (26%).
Other counties showing low absorption rates include Baringo and Tana River, each at 7%, with Taita-Taveta, Kisumu, Nairobi City, and Nyeri all at 6%.
Elgeyo-Marakwet, Lamu, Nakuru, and Kitui each recorded a 5% absorption rate.
The Institute of Economics Affairs defines absorption rate in government budgeting as measures in the percentage of a budget that is spent according to plan. It is a key metric in assessing the efficiency of government spending.
The OCOB’s data showed that county governments spent Sh33.60 billion on development projects, representing 16% of their total annual development budget of Sh211.53 billion.
“This marks an increase from the 12% absorption rate recorded in the same period in the 2023/24 financial year when counties spent Sh203.11 billion on development,” the report explained.
Development expenditure includes capital projects such as infrastructure, roads and public facilities, which generate long-term wealth.
The Controller of Budget noted that the county assemblies spent Sh19.47 million more on MCAs’ sitting allowances compared to the same period in FY 2023/24.
“The county assemblies incurred Sh722.89 million on MCAs’ sitting allowances, against an approved annual budget allocation of Sh1.95 billion, which translates to 37% of the approved budget for MCAs’ sitting allowances. This is an increase from the 35% absorption rate realized in FY 2023/24, when Sh703.62 million was incurred,” the agency stated.
Recurrent expenditure in government budgeting refers to the ongoing costs of running a government’s operations and maintaining its assets. This includes salaries, pensions, interest payments, and general maintenance.
The Margaret Nyakang’o led agency, charged with overseeing the implementation of budgets for national and county governments, observed that the outstanding pending bills owed by the 47 counties stood at Sh180.52 billion as of December 31, 2024.
“The outstanding pending bills stock comprises Sh143.49 billion for recurrent activities and Sh37.03 billion for development activities,” the OCOB report highlighted.
The CGBIRR is based on data from the approved and revised county budgets for FY 2024/25, financial and non-financial reports from the county governments, exchequer requisition records, and reports generated from the Integrated Financial Management Information System (IFMIS).
The report, which is prepared every four months and submitted to Parliament, analyzes the approved budgets of the forty-seven county governments, revenue received into the County Revenue Funds, exchequer disbursements, and expenditures.