City Affairs

Nairobi collects Sh3.81 billion in revenue in six months

An aeriel view of Nairobi City. (Photo: Natalia Pushchina)

By Ibrahim Omar | Friday, February 2, 2024

This is an increase from the Sh2.73 billion that the county collected during the same period in the previous financial year.

Nairobi County’s own-source revenue grew by 39.5 per cent in the half-year to December, driven by an increase in revenue collection from key sources.

Data published by the county shows the city collected Sh3.81 billion in own-source revenue in the six months to December 2023, which is the first half of the financial year 2023–24.

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This is an increase from the Sh2.73 billion that the devolved unit collected during the same period in the previous financial year.

Parking fees topped the county’s revenue, with the city collecting Sh872.6 million from motorists during the half-year period. In the same period in 2022, the county collected Sh798 million.

The county reaped big from land rates, with revenue from landowners breaching the half-billion mark to hit Sh625.8 million, which is more than double the Sh302.3 million that it collected from landowners in the previous year.

Revenue drivers

Revenue from the issuance of single business permits also recorded a significant increase to Sh426.8 million, up from Sh352 million, while income from rental houses and stalls hit Sh233.1 million from Sh183.9 million.

Other top revenue drivers were the issuance of building permits (Sh541.3 million), billboards and advertisements (Sh244.7 million), and other incomes (Sh427 million).

“In the first six months of FY2023/24, the county received Sh8.329 billion as the equitable share of the revenue raised nationally, Sh3 million from grants, had a cash balance of Sh1.21 billion from FY2022/23, and raised Sh3.814 billion as own-source revenue. The total funds available for budget implementation during the period amounted to Sh13.361 billion,” said the county.

With half of the year gone, the own-source revenue is only 23 per cent of the ambitious target of Sh16.1 billion that it targets to collect by the close of the fiscal year on June 30.

Nairobi’s approved budget for FY2023/24 stood at Sh42.33 billion, comprising Sh14.01 billion (33.1 per cent) and Sh28.32 billion (66.9 per cent) allocations for development and recurrent programmes, respectively.

“During the reporting period, the County Executive committed Sh15.536 billion on recurrent programmes and Sh4.583 billion on development programmes,” added the county.

With significant increases in equitable revenue share from the National Treasury through annual allocation hard to come by, Nairobi, as well as the other 46 counties, are being forced to raise their own-source revenue collection to meet their growing spending needs.

For instance, Nairobi residents who own apartments within blocks and share common areas within apartments will, starting in January, have to pay land rates to the county government.

Some counties have also started digitising their revenue systems to seal revenue leakage loopholes, which are bleeding the devolved units billions of shillings in lost revenue every year.