B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 3 TABLE OF CONTENT PREFACE .............................................................................................................................................. 1 ACKNOWLEDGEMENT .................................................................................................................... 2 TABLE OF CONTENT ........................................................................................................................ 3 ABBREVIATIONS AND ACRONYMS ............................................................................................. 4 LEGAL BASIS FOR THE PUBLICATION OF THE COUNTY BUDGET REVIEW AND OUTLOOK PAPER .............................................................................................................................. 5 FISCAL RESPONSIBILITY PRINCIPLES IN THE PUBLIC FINANCIAL MANAGEMENT LAW ....................................................................................................................................................... 6 I. INTRODUCTION ......................................................................................................................... 7 LEGAL FRAMEWORK ........................................................................................................................... 8 II. REVIEW OF FISCAL PERFORMANCE FOR THE FY 2022/2023 ...................................... 9 FISCAL PERFORMANCE OF THE COUNTY ............................................................................................ 9 TRANSFER FROM NATIONAL GOVERNMENT ..................................................................................... 10 RECEIPTS FROM NATIONAL GOVERNMENT, DONOR FUNDING AND GRANTS. .................................. 11 BALANCES BROUGHT FORWARD ....................................................................................................... 13 REVENUE COLLECTION ..................................................................................................................... 14 COUNTY EXPENDITURE ............................................................................................................... 18 III. RECENT ECONOMIC DEVELOPMENTS AND OUTLOOK ............................................ 26 RECENT ECONOMIC DEVELOPMENTS ............................................................................................... 26 ANALYSIS OF EXPENDITURE ............................................................................................................. 28 COUNTY EXECUTIVE ......................................................................................................................... 28 COUNTY ASSEMBLY .......................................................................................................................... 28 ADHERENCE TO FISCAL RESPONSIBILITY PRINCIPLES ....................................................................... 29 IV. ANALYSIS OF EXPENDITURE PER DEPARTMENT ................................................... 31 1) AGRICULTURE, LIVESTOCK AND FISHERIES ............................................................................. 31 2) TRADE, INVESTMENT, INDUSTRY AND COOPERATIVES ............................................................ 35 3) EDUCATION AND VOCATIONAL TRAINING ............................................................................... 38 4) FINANCE, ICT AND ECONOMIC PLANNING ............................................................................... 40 5) SPORTS, CULTURE AND SOCIAL SERVICES ............................................................................... 43 6) TRANSPORT, PUBLIC WORKS AND ENERGY .............................................................................. 46 7) PUBLIC SERVICE ADMINISTRATION AND GENDER .................................................................... 49 8) LANDS, HOUSING AND URBAN DEVELOPMENT ........................................................................ 52 9) WATER, IRRIGATION, ENVIRONMENT AND NATURAL RESOURCES. ......................................... 54 10) HEALTH AND SANITATION .................................................................................................... 59 11) COUNTY PUBLIC SERVICE BOARD ........................................................................................ 63 12. GOVERNORSHIP ........................................................................................................................... 66 13) COUNTY ASSEMBLY .............................................................................................................. 69 V. PROPOSED REVENUE PROJECTIONS .................................................................. 72 VI. PROPOSED DEPARTMENTAL CEILINGS ......................................................... 72 B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 4 Abbreviations and Acronyms ADP Annual Development Plan BCRH Busia County Referral Hospital CA County Assembly CBROP County Budget Review and Outlook Paper CEC County Executive Committee CFSP County Fiscal Strategy Paper CG County Government CIDP County Integrated Development Plan CILOR Contribution In Lieu of Rates ECDE Early Childhood Development Education FY Fiscal Year GDP Gross Domestic Product HELB Higher Education Loans Board IFMIS Integrated Financial Management Information Systems KDSP Kenya Devolution Support Programme M&E Monitoring and Evaluation O&M Operations and Maintenance PE Personnel Emoluments PFMA Public Finance Management Act B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 5 Legal Basis of CBROP Legal Basis for the Publication of the County Budget Review and Outlook Paper The County Budget Review and Outlook Paper is prepared in accordance with Section 118 of the Public Finance Management Act, 2012. The law states that: 1) The County Treasury shall prepare and submit to County Executive Committee for approval, by 30th September in each financial year, a County Budget Review and Outlook Paper which shall include: a) Actual fiscal performance in the previous financial year compared to the budget appropriation for that year. b) Updated economic and financial forecasts with sufficient information to show changes from the forecasts in the most recent County Fiscal Strategy Paper. c) Information on how actual financial performance for the previous financial year may have affected compliance with the fiscal responsibility principles or the financial objectives in the latest County Fiscal Strategy Paper; and the reasons for any deviation from the financial objectives in the County Fiscal Strategy Paper together with proposals to address the deviation and the time estimated for doing so. 2) The County Executive Committee shall consider the County Budget Review and outlook Paper with a view to approving it, with or without amendments, within fourteen days after its submission. 3) Not later than seven days after the County Budget Review and Outlook Paper (CBROP) has been approved by the County Executive Committee, the County Treasury shall: a) Submit the paper to the Budget Committee of the County Assembly to be laid before County Assembly and b) Publish and publicize the paper not later than fifteen days after laying the Paper before the Assembly. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 6 Fiscal Responsibility Principles in the PFM Law Fiscal Responsibility Principles in the Public Financial Management Law In line with the Constitution, the Public Finance Management (PFM) Act, 2012 sets out the fiscal responsibility principles to ensure prudency and transparency in the management of public resources. The PFM Act (Section107) states that: 1) The County Government’s recurrent expenditure shall not exceed the County Government’s total revenue. 2) Over the medium term a minimum of thirty percent of the County Government’s budget shall be allocated to the development expenditure. 3) The County Government’s expenditure on wages and benefits for public officers shall not exceed a percentage of the County Government’s total revenue as prescribed by the County Executive Member for Finance regulations and approved by the County Assembly. 4) Over the medium term, the County Government’s borrowings shall be used only for the purpose of financing development expenditure and not for recurrent expenditure 5) The County debt shall be maintained at a sustainable level as approved by County assembly. 6) Fiscal risks shall be managed prudently 7) A reasonable degree of predictability with respect to the level of tax rates and tax bases shall be maintained, taking into account any tax reforms that may be made in the future B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 7 I. INTRODUCTION Objectives of County Budget Review and Outlook Paper (CBROP) 1) The main objectives of the CBROP 2023 are; a) To provide an analysis of actual fiscal performance in the Financial Year 2022/2023 compared to the budget appropriation for that year. b) This 2023 CBROP is a key document in linking policy, planning and budgeting. The department’s priority submission is in line with County Integrated Development Plan (CIDP) 2023-2027. This year’s CBROP is embedded on the priorities of the County Government while taking on board emerging challenges while implementing the devolved system of Governance. c) As required by the PFM Act, 2012, budget process aims to promote efficient and effective use of resources, based on evidence and rational deliberation. To achieve this, CBROP 2023 has provided the proposed departmental ceilings as guided by the overall resource envelope. The ceilings sets in motion, the budget preparation for the Financial Year 2024/25 and the Medium-Term Expenditure Framework (MTEF). d) To provide updated economic and financial forecasts with sufficient information to show changes from the forecasts in the County Fiscal Strategy Paper 2023(CFSP). e) To provide information on any changes in the forecasts compared with the County Fiscal Strategy Paper; or how actual financial performance for the previous financial year may have affected compliance with the fiscal responsibility principles or the financial objectives in the CFSP 2023; and f) To give the reasons for any deviation from the financial objectives together with proposals to address the deviation and the time estimated to do so. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 8 Legal Framework 2) The County Budget Review and Outlook paper (CBROP 2023) is prepared in line with section 118 of the Public Finance Management Act, 2012. The Act requires that every County prepares a CBROP by 30th September of that financial year and submit the same to the County Executive Committee (CEC). The CEC shall in turn: 1) Within fourteen days after submission, consider the CBROP with a view to approving it, with or without amendments. Not later than seven days after the CEC has approved the paper, the County treasury shall:- a) Arrange for the paper to be laid before the County Assembly. b) As soon as practicable after having done so, publish and publicize the Paper. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 9 II. REVIEW OF FISCAL PERFORMANCE FOR THE FY 2022/2023 Fiscal Performance of the County 1) In the Financial Year 2022/2023, the total approved revised budget for the County Government of Busia amounted to Ksh. 9.577 billion. This is 6.4% decrease in comparison to the FY 2021/2022 budget that was Ksh.10.23 billion. This reduction is attributed to review of own source revenue downwards from ksh. 976.1 million to ksh. 469.2 million as well as cessation of some conditional grants such as Transforming Health Systems for Universal Health Care of ksh 42.2 million, Water Tower Protection and Climate Change Mitigation and Adaptation Programme of ksh 106 Million and Kenya Urban Support Programme of ksh 202 million among others. The actual expenditure for Busia County in the Financial Year 2022/2023 aggregated to Ksh. 7.46 billion representing an absorption rate of 78% of the total Budget. This was an increase from an absorption rate of 71% attained in the Financial Year 2021/2022. 2) In the year under review, the unabsorbed 22% is attributed to majorly i. Underperformance in own source revenue ii. Delayed disbursement of funds from National Treasury iii. Lengthy procurement processes and controls from National Treasury 3) Mitigation measures to address under absorption: i. Timely release of funds by the National Treasury ii. Timely procurement of goods and services iii. Engage contractors to complete remaining works as per agreed timelines. iv. Setting of realistic and achievable targets on own source revenue 4) Throughout the Financial Years 2015/16 to 2022/2023, the County Government could not spend 26% of its approved budget. Financial year 2021/2022 had the highest under absorption of 29% while 2020/2021 recorded the least under absorption of 21%. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 10 Table 1: Summary of the Total County Budgetary Allocation and Expenditure for FY 2015/16-2022/2023 Financial Year Approved Budget Actual Spending Variance (Ksh. Bil.) (Ksh. Bil.) ( %) 2015/2016 7.3 5.4 26.03 2016/2017 7.54 5.35 29.05 2017/2018 7.45 5.38 27.79 2018/2019 8.83 6.65 24.69 2019/2020 9.28 6.78 26.94 2020/2021 10.42 8.19 21.40 2021/2022 10.23 7.22 29.42 2022/2023 9.58 7.46 22.13 Totals 70.63 52.43 25.77 Graph 1: Summary of the Total County Budgetary Allocation and Expenditure for FY 2015/2016 - 2022/2023 Source: County Treasury Transfer from National Government 5) In the FY 2022/2023, the County Government received a direct transfer of Ksh 7.997 billion to the CRF account from the National Government. This amount consisted Ksh 7.745 billion received as equitable share. This consisted of 7.1 billion that had been approved in the county allocation of revenue act 2022 and kshs 573 million delayed disbursement received in relation to equitable share for FY 2021/2022. Further, the county received Ksh. 125.33 million from Kenya Climate Smart Agriculture Project 0 2 4 6 8 10 12 2015/2016 2016/2017 2017/2018 2018/2019 2019/2020 2020/2021 2021/2022 2022/2023 Approved Budget (Ksh. Bil.) Actual Spending (Ksh. Bil.) B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 11 (KCSAP), Ksh19.06 million from DANIDA, Ksh 2.34 million from Kenya Urban Support Program-(KUSP)-Urban Development Grant, Ksh 22 million from Financing Locally-Led Climate Action Program (fLLoCA)-County Climate Institutional support (CCIS) Ksh15.60 million for Agriculture Sector Development Support Programme II (ASDSP II) and ksh 67.19 from National Agricultural Value Chain Development Project (NAVCDP). 6) The County Government actual own source revenue amounted to Ksh.343.92 million, aggregating the total county revenue received from both the National government and own source revenue in the FY 2022/2023 to Ksh.8.34 Billion. In addition the balances brought forward from FY 2021/2022 amounted to Ksh 558.61 Million. Receipts from National Government, Donor funding and Grants. 7) County Government of Busia received a total of Ksh. 7.997 Billion against expected amount of Ks. 9.11 Billion. Table 2: Receipts from National Government, Donor funding and Grants. REVENUE SOURCES APPROVED BUDGET FY 2022/2023 ACTUAL RECEIVED FY 2022/2023 Equitable Share. 7,172,162,009 7,745,934,967 Sub Total 7,172,162,009 7,745,934,967 Conditional Grants Transforming Health System for Universal Health Care 0 0 Kenya Climate Smart Agriculture Project(KCSAP) 421,123,660 125,328,154 DANIDA 32,017,375 19,062,823 Agriculture Sector Development Support Programme II (ASDSP II) 31,498,206 15,604,078 Water Tower Protection and Climate Change Mitigation and Adaptation Programme (WaTER) 0 0 Kenya Urban Support Programme 2,339,915 2,339,915 Nutrition international 0 0 Financing Locally-Led Climate Action Program(Flloca)-County Climate Institutional 22,000,000 22,000,000 Financing Locally-Led Climate Action Program(Flloca) 125,000,000 0 National Agricultural Value Chain Development Project (NAVCDP) 70,000,000 67,192,729 County Revenue Fund 837,850,166 0 Transforming Health System For Universal Health Care Fy 2021/2022 42,178,872 0 Kenya Climate Smart Agriculture Project(KCSAP) 233,586,801 0 B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 12 REVENUE SOURCES APPROVED BUDGET FY 2022/2023 ACTUAL RECEIVED FY 2022/2023 Sub Total 1,817,594,995 251,527,699 Balance brought forward Busia County Health Facility Fund Fy 2021/2022 Kenya Devolution Support Programme (KDSP)Level ''Ii" Grant Fy 2019/2020 46,409,820 0 Kenya Devolution Support Programme (KDSP)Level ''Ii" Grant Fy 2020/2021 300,001 0 Agriculture Sector Development Support Programme Ii (ASDSP II) Fy 2020/2021 2,606,538 0 Agriculture Sector Development Support Programme Ii (ASDSP II) Fy 2021/2022 26,009,940 0 Busia County Health Facility Fund Fy 2021/2022 3,073,654 0 Covid 19- 2021/2022 23,139,540 0 Road Maintenance Fuel Levy Fy 2020/2021 537,207 0 DANIDA 16,022,749 0 Nutrition International Fy 2020/2021 22,111 0 Grant For Development Of Village Polytechnics 839,336 0 Sub Total 118,960,896 0 Grrand total 9,108,717,900 7,997,462,666 8) In the FY 2022/23 a total of Ksh. 537.48 million was not disbursed to the County as Summarized in the table below. Table 3: Summary of undisbursed revenue from National Government REVENUE SOURCES BUDGET FY 2022/23 SUPPLEM ENTARY 2022/23 REVISED BUDGET 2022/23 ACTUAL REVENUE (Ksh) VARIANC E (Ksh) REMAR K NATIONAL GOVERNMENT: - - - - - 0% National Agricultural Value Chain Development Project (Navcdp) - 70,000,000 70,000,000 67,192,729 2,807,271 96% Transforming Health System For Universal Health Care 42,178,872 - 42,178,872 - - - 0% Kenya Climate Smart Agriculture Project(Kcsap) 295,795,506 125,328,154 421,123,660 125,328,154 295,795,506 30% Kenya Devolution Support Programme Level ''Ii" Grant 69,825,044 - 69,825,044 - - - 0% Danida 13,323,750 18,693,625 32,017,375 19,062,823 12,954,552 60% Agriculture Sector Development Support Programme Ii (Asdsp Ii) 26,009,940 5,488,266 31,498,206 15,604,078 15,894,128 50% Kenya Livestock Commercialization Project (Kelcop) 30,000,000 - 30,000,000 - - - 0% Water Tower Protection And Climate Change Mitigation And Adaptation Programme (Water) - - - - - 0% B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 13 REVENUE SOURCES BUDGET FY 2022/23 SUPPLEM ENTARY 2022/23 REVISED BUDGET 2022/23 ACTUAL REVENUE (Ksh) VARIANC E (Ksh) REMAR K Kenya Urban Support Programme(Busia) - - - - - 0% Nutrition International - - - - - 0% Financing Locally-Led Climate Action Program(Flloca) - 125,000,000 125,000,000 - 125,000,000 0% Financing Locally-Led Climate Action Program(Flloca)-County Climate Institutional - 22,000,000 22,000,000 22,000,000 - 100% Kenya Urban Support Program-(Kusp) Urban Institutional Grant - 1,145,356 1,145,356 1,145,356 - 100% Kenya Urban Support Program-(Kusp)-Urban Development Grant - 1,194,559 1,194,559 1,194,559 - 100% Bf 2021/2022 - - - - - 0% Transforming Health System For Universal Health Care Fy 2021/2022 - 42,178,872 42,178,872 - 42,178,872 0% Agriculture Sector Development Support Programme Ii (Asdsp Ii) Fy 2021/2022 - 26,009,940 26,009,940 - 26,009,940 0% Danida - 16,022,749 16,022,749 - 16,022,749 0% Total 477,133,112 371,118,800 848,251,912 251,527,699 537,482,276 30% Balances brought forward In the FY 2022/23 balances brought forward amounted to ksh. 1.45 billion as summarized below: Table 4: Summary of balances brought forward ACCOUNT DESCRIPTION 2022 – 2023 2021 – 2022 Ksh a) COUNTY EXECUTIVE CBK ACCOUNTS CBK Recurrent 1,772 61,758 Busia County Village Polytechnics 839,336 839,336 Busia County Special Purpose Account 14,671,312 9,360,874 CBK Road Maintenance Fuel Levy Fund 537,207 537,207 CBK Development 236,166 361,091 CBK Revenue Fund 1,217,406,348 184,265,868 Busia Climate Smart Agriculture Project 15,055,215 173,525,606 Busia County Deposit Account 5,104,361 3,606,858 Busia County Kenya Devolution Support Programme 5,388,976 46,409,820 Covid 19 Special Account 23,139,540 23,139,540 Busia County Health NI (Nutrition International) Account Busia County 12,466,970 22,111 Busia County Health Facility Improvement Fund 16,572,618 3,073,654 Agricultural Sector Development Support Program 2,610,445 2,606,538 B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 14 ACCOUNT DESCRIPTION 2022 – 2023 2021 – 2022 Ksh Climate Change Fund Account 17,290,300 - NAVCDP 67,192,729 - (b) COMMERCIAL ACCOUNTS Busia County Institutional Grant - - Busia County Urban Support Grant 1 - Busia County health service account KCB - - Khunyangu Health Centre National Bank Of Kenya -Health (NHIF) 785,023 3,290,523 Busia County Referral Hospital National Bank Of Kenya - Health (NHIF) - 11,463,154 Sio Port Victoria Health Centre KCB - Health (NHIF) 202 2,599,621 Port Victoria Health Centre National Bank Of Kenya -Health (NHIF) 1,830,092 3,988,282 Nambale Sub County Hospital KCB -Health (NHIF) 144 99,709 Kocholia Sub County Hospital KCB -Health (NHIF) - 3,612,100 Alupe Sub County Hospital KCB -Health (NHIF) 8,370 1,172,016 Busia County Car and Mortgage Account 6,816 0 National Bank Busia County ASDSP Account National Bank 1,647,882 16 Co-Op Bank Standing Imprest A/C - 999,400 Busia County KCSAP Account Coop Bank 25,658 6,520 County Health Management Team 7,377,719 2,892,736 KCB Revenue Collection 26,923,153 79,388,491 Co-Op Bank Education Imprest 10,666,381 1,283,167 Total 1,447,784,733 558,605,994 Revenue Collection The total County annual local revenue approved target in the Financial Year 2022/2023 was Ksh. 469.16 Million. During the period, the County generated a total revenue of Ksh. 343.92 Million, which is 73% of the annual target. The own sources revenue streams performed fairly well falling short of target by Ksh.125.24 Million translating to 27%. Compared to the previous financial year 2021/2022 collection of ksh. 292,736,456 against target of ksh. 976.1 Million, there was an increase of 17% in actual collection. Key challenge encountered include valuation roll not being fully implemented. 9) The County continues to explore new and innovative ways of increasing its local revenue collections. Some of the steps that the County has taken towards improving its revenue collections include: B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 15 a) Automation of revenue collection system – the County is currently using County Pro Revenue system as the revenue collection system; b) Continuous revenue mapping and putting in place proper revenue collection enforcement measures. c) Allocation of service delivery vehicles to enhance local revenue collection. d) Fully implement valuation roll County Own Source Revenue per Stream Code Revenue Sources Actuals Actuals Approved Budget Revised Budget Estimates Actuals Deviation from Target Percentage Deviation FY 2020- 2021 FY 2021- 2022 FY 2022 2023 FY 2022 2023 FY 2022 2023 FY 2022 2023 FY 2022 2023 Kshs. Kshs. Kshs. Kshs. Kshs. Kshs. % Administrative Services 1,113,360 1,785,200 1,853,070 1,853,070 3,066,850 (1,213,780) -66% 1590201 Fire Safety 779,100 1,427,000 1,296,730 1,296,730 2,472,800 (1,176,070) -91% 1550225 Impounding/Clamp. Fees 334,260 358,200 556,340 556,340 594,050 (37,710) -7% Smart Agriculture, Livestock, Fisheries, Blue Economy and Agribusiness 56,823,982 41,900,727 68,766,111 68,766,111 51,387,342 17,378,769 25% 1420345 Sugar Cane Cess 6,413,364 8,776,759 10,674,368 10,674,368 17,144,545 (6,470,177) -61% 1520325 Transit Produce Cess 35,635,870 24,177,240 38,876,576 38,876,576 25,158,400 13,718,176 35% 1520325 Tobacco Cess 1,659,668 1,254,243 2,762,342 2,762,342 908,347 1,853,995 67% 1520325 Fish Cess 707,450 736,320 1,183,801 1,183,801 913,770 270,031 23% 1420102 Tractor Hire Services 98,500 124,100 163,943 163,943 - 163,943 100% 1420102 Agriculture Training College 6,475,570 1,086,915 5,669,010 5,669,010 943,855 4,725,155 83% 1420102 Veterinary Services 1,797,570 1,477,790 3,746,693 3,746,693 1,752,545 1,994,148 53% 1420102 Stock Sale 3,266,170 3,349,480 4,408,093 4,408,093 3,630,190 777,903 18% 1420102 Fish Traders Licence 223,570 278,700 372,108 372,108 118,200 253,908 68% 1420102 Fish Movement Permit 89,560 243,990 149,063 149,063 109,500 39,563 27% 1420102 Livestock movement permit - - - 1420102 Vaccination - - - 1420102 Artificial Insemination - - - 1420102 Slaughter premise licences - - 459,650 (459,650) 1420102 Meat Carrier Licence - - - 1420102 Meat inspection fees( Bovine, pigs, sheep and goats) - - - 1420206 Reg. Of Boats License 96,450 29,350 160,531 160,531 31,400 129,131 80% 1420206 Fisherman's License 272,300 79,650 453,215 453,215 77,000 376,215 83% 1420206 Fish Import Permit 87,940 107,140 146,367 146,367 37,640 108,727 74% 1540100 Wakhungu Fish Farm - - - - Cage Licencing 179,050 - - 102,300 (102,300) Certificate of Transport - - - - - Automation for licenses for agro- dealers - - - Youth, Sports, Culture,Gender, Creative Arts and Social Services 171,200 277,750 315,138 315,138 160,650 154,488 49% 1560201 Hire Of Hall / Office 70,500 73,500 147,534 147,534 56,000 91,534 62% 1560201 Hire of Busia County Stadium - Registration/ Renewal of SHGs, CBOs, Women groups and Youth groups 100,700 204,250 167,604 167,604 104,650 62,954 38% Health Services and Sanitation 121,012,598 98,827,674 158,451,783 158,451,783 146,364,911 12,086,872 8% 1540100 Mortuary Fees 5,571,162 6,857,970 9,272,613 9,272,613 5,040,285 4,232,328 46% 1580401 Slaughter Fees 504,790 401,850 840,170 840,170 - 840,170 100% 1580211 Hospital User Fees- 112,287,836 88,313,134 143,930,335 143,930,335 84,905,000 59,025,335 41% 1580211 NHIF 52,205,326 (52,205,326) 1540100 Public Health services 2,648,810 3,254,720 4,408,665 4,408,665 4,214,300 194,365 4% Lands,Housing And Urban Development 23,797,696 35,129,240 66,013,913 66,013,913 26,438,175 39,575,738 60% 1130102 Plot Rent 1,045,423 1,806,511 4,759,306 4,759,306 - 4,759,306 100% 1130102 Plot Rent Arrears - - - 830,020 (830,020) B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 16 Code Revenue Sources Actuals Actuals Approved Budget Revised Budget Estimates Actuals Deviation from Target Percentage Deviation FY 2020- 2021 FY 2021- 2022 FY 2022 2023 FY 2022 2023 FY 2022 2023 FY 2022 2023 FY 2022 2023 Kshs. Kshs. Kshs. Kshs. Kshs. Kshs. % 1410499 Rent/Gov Houses 2,400,850 10,780,812 2,463,294 2,463,294 4,511,838 (2,048,544) -83% 1520101 Land Rates 6,925,367 29,366,615 29,366,615 3,649,803 25,716,812 88% 1520102 Land Rates (Arrears) 2,058,600 - - - - - 1530102 Application Of Plans 307,000 - 510,969 510,969 - 510,969 100% 1530125 Building Plans Approval 8,083,700 6,672,600 12,432,688 12,432,688 4,927,616 7,505,072 60% 1530302 Solid Waste 1,846,118 1,600,600 3,072,669 3,072,669 - 3,072,669 100% 1590132 Advertisement 8,056,005 7,343,350 13,408,371 13,408,371 12,518,898 889,473 7% Transport, Roads and Public Works 30,821,429 38,747,770 52,568,419 52,568,419 31,894,751 20,673,668 39% 1420404 Trailer Parking Fees 6,244,320 4,532,310 10,903,902 10,903,902 2,468,580 8,435,322 77% 1420404 Reserved Parking 3,136,360 (3,136,360) 1420404 Bus Parking Fees 23,786,609 34,171,460 35,819,848 35,819,848 26,091,811 9,728,037 27% 1540100 Machine Hire 790,500 44,000 5,844,668 5,844,668 198,000 5,646,668 97% Water, Environment, Irrigation, Natural Resources and Climate Change 5,505,802 4,836,836 13,074,793 13,074,793 5,625,671 7,449,122 57% 1530302 Solid Waste 2,625,470 (2,625,470) 1530301 Sand Cess 1,334,200 2,108,190 2,206,690 2,206,690 1,214,850 991,840 45% 1420502 Busia Hills Water Supply 962,531 696,339 1,602,032 1,602,032 476,932 1,125,100 70% 1420502 Busijo Water Supply 376,580 267,605 1,035,489 1,035,489 212,895 822,594 79% 1420502 Alema Water Supply 78,576 - - 700 (700) 1420502 Munana Water Supply 421,003 266,245 1,109,427 1,109,427 153,387 956,040 86% 1420502 Butula Water Supply 748,271 407,111 1,245,419 1,245,419 304,025 941,394 76% 1420502 Port Victoria Water Supply 1,281,417 193,070 2,132,783 2,132,783 89,972 2,042,811 96% 1540105 Drilling Rig - 2,903,132 2,903,132 - 2,903,132 100% 1540105 Noise 118,800 312,700 402,086 402,086 358,200 43,886 11% 1540105 Water Bowser 263,000 507,000 437,736 437,736 189,240 248,496 57% Trade, Investment, Industrialisation, Co-operatives, Small and Micro Enterprises (SME) 83,112,160 71,231,258 108,119,798 108,119,798 78,984,625 29,135,173 27% 1440501 Liqour License 200,000 1,400,000 3,352,189 3,352,189 1,353,000 1,999,189 60% 1520328 Single Business Permit 54,959,591 53,014,797 67,973,538 67,973,538 64,080,118 3,893,420 6% 1550105 Market Stall / Kiosk 671,110 688,764 1,116,992 1,116,992 748,410 368,582 33% 1520405 Markets Fees 15,778,390 14,824,631 31,370,361 31,370,361 12,679,690 18,690,671 60% 1540100 Weghts & Measures 184,170 85,680 306,532 306,532 - 306,532 100% 1520344 Co-Operatives Audit Fees 9,800 28,020 16,314 16,314 44,530 (28,216) -173% 1540100 Other Miscellaneous 11,509,100 1,189,366 3,983,873 3,983,873 78,877 3,904,996 98% Total Revenue Local Source 322,358,227 292,736,456 469,163,025 469,163,025 343,922,975 125,240,050 27% Less: Appropriation in Aid 158,451,783 158,451,783 142,150,611 16,301,172 10% Total Net Own Source Revenue 322,358,227 292,736,456 310,711,243 310,711,243 201,772,364 108,938,879 35% Table 5: County Revenue Monthly Analysis for the FY 2021/2022 and FY 2022/2023 YEARS FY 2021/2022 FY 2022/2023 VARIANCE % VARIANCE July 25,426,452 27,623,728 -2,197,276 -9% August 19,096,972 14,895,637 4,201,335 22% September 21,345,072 14,218,087 7,126,985 33% October 18,065,961 13,722,024 4,343,937 24% November 35,003,471 14,827,004 20,176,467 58% December 19,291,737 14,391,545 4,900,192 25% January 21,608,632 26,938,624 -5,329,992 -25% February 32,825,849 30,275,408 2,550,441 8% March 34,653,036 38,341,155 -3,688,119 -11% April 22,836,500 59,008,821 -36,172,321 -158% May 21,404,541 63,458,625 -42,054,084 -196% June 21,178,232 26,222,317 -5,044,085 -24% Total Revenue 292,736,456 343,922,975 -51,186,519 -17% Source: County Treasur B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 17 Graph 2: Revenue Collection comparison between 2021/2022 and 2022/2023 Graph 3: Trend of Revenue Collection for 2021/2022 and 2022/2023 0 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 60,000,000 70,000,000 FY 2021/2022 FY 2022/2023 0 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 60,000,000 70,000,000 Chart Title FY 2021/2022 FY 2022/2023 B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 18 County Expenditure 10) Busia County total approved budget for financial year 2022/2023 was Ksh 9.578 billion. This comprised of Ksh. 3.033 billion as development expenditure representing 32% while recurrent was at Ksh 6.544 billion representing 68% of total approved budget. 11) Recurrent expenditure constituted of Personnel emoluments of Ksh 3.324 Billion and Operations and Maintenance of Ksh 3.221 Billion. 12) County Government total actual expenditure for the year ending June 2022/2023 was Ksh 7.482 billion (78% of total budget). This comprised of actual recurrent and development expenditure of Ksh 6.226 Billion and Ksh 1.257 billion respectively. Table 6: Summary of the Total County Expenditure Category Budget Allocation 2022/2023 Actual Expenditure 2022/2023 Percentage absorption Recurrent 6,544,605,284 6,225,689,163 95.13% Employee Compensation 3,323,528,569 3,323,168,859 99.99% Operation and Maintenance 3,221,076,715 2,902,520,304 90.11% Development 3,033,275,641 1,257,066,447 41.44% Total Expenditure 9,577,880,925 7,482,755,609 78.13% Source: County Treasury Graph 4: Analysis of Total Expenditure 0 500 1,000 1,500 2,000 2,500 3,000 3,500 Employee Compensation Operation and Maintenance Development M ill io n s  Budget Allocation 2022/2023 Actual Expenditure 2022/2023 B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 19 13) The county wage bill for the FY 2022/23 was Ksh. 3.324 billion, this represents 35% of the total budget of Ksh 9.578 billion as compared to the wage bill for the FY2021/2022 which was Ksh. 3.399 billion that represented 33% of its total budget of Ksh. 10.23 billion. Table 7: Analysis of County Wage Bill 2016/17-2022/2023 Financial Year 2016/2017 2017/2018 2018/2019 2019/2020 2020/2021 2021/2022 2022/2023 Compensation to Employees 2,565,509,171 2,673,066,305 2,924,788,741 3,111,652,998 3,298,758,235 3,398,725,757 3,323,528,569 Total 2,565,509,171 2,673,066,305 2,924,788,741 3,111,652,998 3,298,758,235 3,398,725,757 3,323,528,569 Graph 5: Trend of wage Bill for the county 2016/17-2022/23 0 500,000,000 1,000,000,000 1,500,000,000 2,000,000,000 2,500,000,000 3,000,000,000 3,500,000,000 2016/2017 2017/2018 2018/2019 2019/2020 2020/2021 2021/2022 2022/2023 B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 20 Table 8: Departmental Budget Allocation and Absorption for the FY 2022/2023 Recurrent Budget Allocation and Absorption 2022/23 Development Budget Allocation and Absorption 2022/23 Total Budget Allocation and Absorption 2022/23 Employee Compensation Operation and Maintenance Budget Actual Absorption Budget Actual Absorption Budget Actual Absorption Budget Actual Absorption 1 Agriculture, Livestock, Fisheries, Climate Change, Blue Economy and Agribusiness 188,121,056 188,120,366 100% 86,814,809 82,611,885 95% 1,101,744,545 532,507,718 48% 1,376,680,410 803,239,969 58% 2 Trade, Investment, Industry and Co- operatives 35,735,751 35,735,751 100% 50,244,797 49,429,832 98% 224,354,992 123,768,092 55% 310,335,540 208,933,675 67% 3 Education and Vocational Training 373,925,209 373,925,209 100% 248,910,468 243,911,688 98% 53,848,748 20,691,401 38% 676,684,425 638,528,298 94% 4 Finance, ICT and Economic Planning 433,673,627 433,665,305 100% 461,284,095 458,033,940 99% 74,758,820 1,637,229 2% 969,716,542 893,336,474 92% 5 Sports, Culture and Social Services 34,572,775 34,572,775 100% 81,668,115 61,811,860 76% 61,790,896 33,182,164 54% 178,031,786 129,566,799 73% 6 Transport, Public Works and Energy 102,166,665 102,133,725 100% 98,926,549 95,211,334 96% 365,644,618 252,908,783 69% 566,737,832 450,253,842 79% 7 Public Service, Administration and Gender 120,311,116 120,311,116 100% 381,255,140 371,350,378 97% - - 501,566,256 491,661,494 98% 8 Lands, Housing and urban Development 54,178,401 54,178,401 100% 140,886,977 114,978,387 82% 264,057,868 92,765,037 35% 459,123,246 261,921,825 57% 9 Water Irrigation, Environment and Natural Resources 65,238,335 65,155,480 100% 131,766,652 89,967,329 68% 400,075,850 99,719,056 25% 597,080,837 254,841,865 43% 10 Health and Sanitation 1,352,762,588 1,352,622,535 100% 668,504,926 636,592,998 95% 396,702,959 71,882,270 18% 2,417,970,473 2,061,097,803 85% 11 County Public Service Board 35,977,949 35,956,893 100% 64,724,196 37,678,669 58% - - 100,702,145 73,635,562 73% 12 The Governorship 95,809,264 95,735,470 100% 385,949,991 240,802,003 62% 30,296,345 5,877,993 19% 512,055,600 342,415,466 67% 13 County Assembly 431,055,833 431,055,833 100% 420,140,000 420,140,000 100% 60,000,000 22,126,706 37% 911,195,833 873,322,539 96% Totals 3,323,528,569 3,323,168,859 100% 3,221,076,715 2,902,520,304 90% 3,033,275,641 1,257,066,447 41% 9,577,880,925 7,482,755,609 78% Source: County Treasury B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 21 Graph 6: Graphical representation of departmental budget allocation against absorption 14) The departments of Public Service Management, County Assembly and Education had the highest absorption rate at 98%, 96%, 93% respectively. 15) Departments of Water, Irrigation, Environment and Natural Resources, Lands Housing and Urban Development and Agriculture Livestock and Fisheries recorded the lowest absorption during the period with a rate of 40%, 57% and 59% respectively. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 22 Expenditure performance at the Programme and Sub Programme level departme nt Programme Sub-Programme Revised Budget Revised Budget Actual Expenditure FY 2022/23 Actual Expenditure FY 2022/23 Variance Absor ption Rate (%) Absor ption Rate (%) Ksh Ksh Ksh Ksh Ksh Recurrent Development Recurrent Development Recurr ent Devel opme nt Agricultur e, Livestock and Fisheries CP 1: General Administration and support services CSP 1.1: Administrative support service 274,935,865 - 270,732,251 0 4,203,614 98% 0% CP 2: Land use and management CSP 2.1: Agricultural mechanization - 14,582,112 0 0 14,582,112 0% 0% CP 3: Crop production and Management CSP 3.1 Input support services - 4,397,440 0 0 4,397,440 0% 0% CSP 3.2: Crop development - 10,400,000 0 4,292,868 6,107,132 0% 41% CSP 3.3: Crop protection - 7,198,880 0 1,150,000 6,048,880 0% 16% CP 4: Agricultural Training and Extension Services CSP 4.1: Agriculture extension services - - 0 0 - 0% 0% CSP 4.2: Agricultural Training services - 74,309,217 0 37,119,731 37,189,486 0% 50% CP 5: Kenya Climate SMART Agriculture program CSP 5.1: Kenya Climate SMART - 654,710,461 0 283,798,546 370,911,916 0% 43% CP 6: Agribusiness and agricultural Value chain Development CSP 6.1: Value addition - 73,000,000 0 0 73,000,000 0% 0% CP 7: Agricultural Financial and Investment services CSP 7.1: Agriculture development fund - 5,000,000 0 5,000,000 - 0% 100% CP 8: Fisheries and Aquaculture Resource Development CSP 8.1: Aquaculture development - 17,241,598 0 6,326,843 10,914,755 0% 37% CSP 8.2: Fisheries training infrastructure development - 20,999,935 0 9,496,230 11,503,705 0% 45% CP 9: Livestock Production Development CSP 9.1: Livestock production improvement - 5,058,555 0 2,500,000 2,558,555 0% 49% CSP 9.2: Livestock Extension - - 0 0 - 0% 0% CP 10: Veterinary health services CSP 10.1: Veterinary Disease control - 25,971,303 0 22,864,369 3,106,934 0% 88% CSP 10.2: AI services - 3,823,600 0 1,414,886 2,408,714 0% 37% CSP 10.3: Meat inspection services - 8,799,886 0 0 8,799,886 0% 0% CSP 10.4: Veterinary Extension - 2,000,000 0 1,506,300 493,700 0% 75% CP 11: Other projects CSP 11.1: Other Development projects - 174,251,558 0 157,037,946 17,213,612 0% 90% Trade, Investmen t, Industry and Cooperati ves CP 12: General Administration and support services CSP 12.1: Administrative support service 85,980,548 - 85,165,583 0 814,965 99% 0% CP 13: Trade Development CSP 13.1: Busia county trade development fund - - 0 0 - 0% 0% CSP 13.2: Market modernization and development - 196,109,112 0 115,740,694 80,368,418 0% 59% CP 14: Fair Trade practices CSP 14.1: Weights and measures. - 3,000,000 0 0 3,000,000 0% 0% CP 15: Cooperative development CSP 15.1: Busia county cooperative enterprise development fund - 8,000,000 0 0 8,000,000 0% 0% B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 23 departme nt Programme Sub-Programme Revised Budget Revised Budget Actual Expenditure FY 2022/23 Actual Expenditure FY 2022/23 Variance Absor ption Rate (%) Absor ption Rate (%) Ksh Ksh Ksh Ksh Ksh Recurrent Development Recurrent Development Recurr ent Devel opme nt CP 16: Other projects CSP 16.1: Other Development projects - 17,245,880 0 8,027,399 9,218,481 0% 47% Education and Vocationa l Training CP 17: General Administration and support services CSP 17.1: Administrative support service 622,835,677 - 617,836,897 0 4,998,780 99% 0% CP 18: Early Childhood Development Education (Basic Education) CSP 18.1: Improvement of infrastructure in E.C.D.E Centers - - 0 0 - 0% 0% CSP 18.2: E.C.D.E Capitation - 8,806,048 0 0 8,806,048 0% 0% CP 19: Technical/ vocational training development CSP 19.1: Infrastructure development - 17,229,850 0 0 17,229,850 0% 0% CP 20: Education support CSP 20.1: Education support scheme - 2,139,336 0 0 2,139,336 0% 0% CP 21: Other projects CSP 21.1: Other Development projects - 25,673,514 0 20,691,401 4,982,113 0% 81% Finance and Economic planning CP 22: General Administration and support services CSP 22.1: Administrative support service 894,957,722 - 891,699,246 0 3,258,476 100% 0% CP 23: Financial management control and development CSP 23.1: Revenue generation services - 60,397,425 0 0 60,397,425 0% 0% CP 24: Infrastructure Development CSP 24.1: Construction and Renovation - - 0 0 - 0% 0% CSP 24.2: ICT Support services - 8,361,500 0 1,637,229 6,724,271 0% 20% CP 25: Other projects CSP 25.1: Other Development projects - 5,999,895 0 0 5,999,895 0% 0% Sports, Culture and Social Services CP 26: General Administration and support services CSP 26.1: Administrative support service 116,240,890 - 96,384,635 0 19,856,256 83% 0% CP 27: Social services CSP 27.1: infrastructural development - 10,606,837 0 0 10,606,837 0% 0% CP 28: Youth Empowerment and development CSP 28.1 Equipping and Operationalization of youth empowerment - 6,700,325 0 0 6,700,325 0% 0% CP 29: Promotion and development of sports CSP 29.1: Infrastructural development - 5,000,000 0 0 5,000,000 0% 0% CSP 29.2: sports promotion - 11,474,200 0 9,449,651 2,024,549 0% 82% CP 30: Child care and protection CSP 30.1: Rehabilitation and custody - 3,251,181 0 981,776 2,269,405 0% 30% CP 31: Promotion and development of local tourism in the county CSP 31.1: Tourism development - - 0 0 - 0% 0% CP 32: Alcoholic drinks and drugs control CSP 32.1: Infrastructure development - - 0 0 - 0% 0% CP 33: Other projects CSP 33.1: Other Development projects - 24,758,353 0 22,750,737 2,007,616 0% 92% Infrastruc ture and Energy CP 34: General Administration and support services CSP 34.1: Administrative support service 201,093,214 - 197,345,059 0 3,748,155 98% 0% CP 35: Development and maintenance of roads CSP 35.1: Routine maintenance of roads - 78,763,123 0 76,320,305 2,442,818 0% 97% CSP 35.2: Development of Roads - 43,597,270 0 19,785,516 23,811,754 0% 45% B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 24 departme nt Programme Sub-Programme Revised Budget Revised Budget Actual Expenditure FY 2022/23 Actual Expenditure FY 2022/23 Variance Absor ption Rate (%) Absor ption Rate (%) Ksh Ksh Ksh Ksh Ksh Recurrent Development Recurrent Development Recurr ent Devel opme nt CP 36: Building Infrastructure Development CSP 36.1: Infrastructure Development - - 0 0 - 0% #DIV/ 0! CP 37: Energy Development CSP 37.1 Energy Services - 2,400,000 0 0 2,400,000 0% 0% CSP 37.1: Solar Energy Exploration - 17,141,077 0 0 17,141,077 0% 0% CP 38: Alternative Transport Infrastructure Development CSP 38.1: Road safety campaign - 637,345 0 0 637,345 0% 0% CP 39: Other projects CSP 39.1: Other Development projects - 223,105,803 0 156,802,962 66,302,841 0% 70% Public Service and Administr ation CP 40: General Administrative and support services CSP 40.1: Administrative support services 501,566,256 - 491,661,494 0 9,904,762 98% 0% Lands, Housing and Urban Developm ent CP 41: General Administrative and support services CSP 41.1: Administrative support services 195,065,378 - 169,156,788 0 25,908,591 87% 0% CP 42: County Land Administration and planning CSP 42.1: Land use planning - 6,000,000 0 0 6,000,000 0% 0% CP 43: Housing Development and Management CSP 43.1: Housing Development - 40,000,000 0 0 40,000,000 0% 0% CP 44: Urban management and development control CSP 44.1: Urban management - 166,768,933 0 61,168,186 105,600,747 0% 37% CSP 44.2: Urban Development - 49,788,935 0 31,596,851 18,192,085 0% 63% CP 45: Other projects CSP 45.1: Other Development projects - 1,500,000 0 0 1,500,000 0% 0% Water, Irrigation, Environm ent and Natural Resources CP 46: General Administrative and support services CSP 46.1: Administrative support services 197,004,987 - 155,122,809 0 41,882,177 79% 0% CP 47: Water supply services CSP 47.1: Urban water supply and sewerage - 37,979,094 0 5,032,444 32,946,651 0% 13% CSP 47.2: Rural water supply - 38,872,743 0 14,872,807 23,999,936 0% 38% CP 48: Environmental management and protection CSP 48.1 Environmental management - 9,974,500 0 0 9,974,500 0% 0% CP 49: Small holder irrigation and drainage CSP 49.1: Irrigation infrastructure development - 7,000,000 0 637,430 6,362,570 0% 9% CP 50: Forest development and management CSP 50.1: Rehabilitation and Restoration degraded landscape - 8,533,103 0 0 8,533,103 0% 0% CP 51: Climate Change Fund CSP 51.1: Financing Locally- Led Climate Action Program (FLLOCA) - County contribution - 55,000,000 0 19,179,647 35,820,353 0% 35% CSP 51.2: Financing Locally- Led Climate Action Program (FLLOCA) - 125,000,000 0 2,897,951 122,102,049 0% 2% CP 52: Other projects CSP 52.1: Other Development projects - 117,716,410 0 57,098,778 60,617,632 0% 49% Health and sanitation CP 53: General Administration and support services CSP 53.1: Administrative support service 2,021,267,514 - 1,989,215,533 0 32,051,981 98% 0% CP 54: Curative Health Services CSP 54.1: Infrastructure development - 118,364,906 0 40,059,854 78,305,052 0% 34% B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 3 : Page | 25 departme nt Programme Sub-Programme Revised Budget Revised Budget Actual Expenditure FY 2022/23 Actual Expenditure FY 2022/23 Variance Absor ption Rate (%) Absor ption Rate (%) Ksh Ksh Ksh Ksh Ksh Recurrent Development Recurrent Development Recurr ent Devel opme nt CSP 54.2: Hospital equipment - 38,515,654 0 0 38,515,654 0% 0% CSP 54.3: Blood transfusion Services - - 0 0 - 0% 0% CP 55: Preventive and Promotive Health Services CSP 55.1: Infrastructure development - 56,837,966 0 1,815,011 55,022,955 0% 3% CSP 55.2: Lower level hospital equipment - 24,044,650 0 0 24,044,650 0% 0% CSP 55.3: Preventive Services - - 0 0 - 0% 0% CSP 55.4: Health promotion unit - 143,358,107 0 17,945,129 125,412,978 0% 13% CP 56: Other projects CSP 56.1: Other Development projects - 15,581,676 0 12,062,276 3,519,400 0% 77% County Public Service Board CP 57: General Administration and support services CSP 57.1: Administrative support service 100,702,145 - 73,635,562 0 27,066,583 73% 0% Governors hip CP 58: General Administration and support services CSP 58.1: Administrative support service 481,759,255 - 336,537,473 0 145,221,782 70% 0% CP 59: Disaster Risk Management CSP 59.1: Disaster preparedness - 20,550,000 0 4,579,493 15,970,508 0% 22% CP 60: Information Dissemination and Knowledge Management CSP 60.1: Communication Services - 5,141,000 0 1,298,500 3,842,500 0% 25% CP 61: ICT support Services CSP 61.1: ICT Services - - 0 0 - 0% 0% CP 62: Other projects CSP 62.1: Other Development projects - 4,605,345 0 0 4,605,345 0% 0% County Assembly CP 63: General Administration and support services CSP 63.1: Administrative support service 851,195,833 - 851,195,833 0 - 100% 0% CP 64: Infrastructure Development CSP 64.1: Infrastructure - 60,000,000 0 22,126,706 37,873,294 0% 37% Total Expenditure 6,544,605,284 3,033,275,641 6,225,689,163 1,257,066,452 2,095,125,315 95% 41% B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 26 III. RECENT ECONOMIC DEVELOPMENTS AND OUTLOOK Recent Economic Developments 16) Kenya's real GDP growth according to African Development Bank decreased from 7.5% in 2021 to 5.5% in 2022 as a result of drought, rising commodity prices, and challenging international financial conditions. Services dominated the market on the supply side, while home consumption dominated the market on the demand side. It was however projected that household spending and the service sector will generate GDP growth of 5.6% in 2023 and 6.0% in 2024. 17) Inflation in food and energy drove the increase in inflation from 6.1% in 2021 to 7.6% in 2022. Subsidies and an increase in the policy rate to 8.25% from 7% in 2021 both helped to restrain inflation. Due to increased tax collection and adherence to the fiscal consolidation path approved by the International Monetary Fund, the fiscal deficit decreased from 8.2% of GDP in 2021 to 6.3% of GDP in 2022. Food and energy inflation are expected to cause inflation to increase to 8.6% in 2023 and 5.9% in 2024. Ongoing tightness in monetary policy is anticipated. 18) At the end of 2022, the Kenyan shilling was worth 123.3 US cents compared to 110.2 cents at the end of 2021; 18.9% and 55%, respectively, of the capital adequacy ratio and liquidity ratio above the corresponding benchmarks of 14.5% and 20%. At 14%, the ratio of nonperforming loans remained high. Manufacturing, energy and water, and agriculture all have substantial credit risk concentrations. 19) Despite the economy facing difficult global financial conditions, shocks to fuel and food prices, and a record drought that had an impact on the economy, particularly in the second half of 2022, the growth rate still continued to follow Kenya's long-term growth track. 20) External risks during the period included further tightening of financial conditions in advanced economies, poorer than expected growth in Europe, increased global commodity prices that could increase Kenya's import costs and raise the cost of lowering inflation. The majority of domestic risks were related to demands on expenditure to lower the high cost of living and a delay in tax efforts. 21) In the financial year 2022/23 several projects were undertaken in the county to improve the economic and developmental status of Busia county citizens and the county at large. These were in areas of agriculture, early childhood education and vocational training, health and sanitation, transport, trade and industrialization among others. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 27 22) The department of agriculture aligned itself to the Bottom Up Economic Transformation Agenda (BETA) of agriculture revitalization by focusing on agro-processing, increasing market participation and value addition supported by establishment of Industrial park at Nasewa, revival of Mulwanda cotton Ginnery and Gazettement of EPZ zone. 23) The department of Trade, Industry, Investment and Cooperatives in collaboration with Trade Mark Africa (TMA) constructed and commissioned the Modern Busia Soko-Posta safe market with a capacity of 160 stalls that were allocated to traders who were affected by the beautification and reorganization exercise within the Busia municipality. 24) In the year under review, it also commenced the development of County Aggregation and Industrial Park (CAIP) at Nasewa as one of the flagship projects of the County 25) Vocational Training directorate in the department of Education and Vocational Training initiated the process of construction of Administration block phase II at Katakwa and Namasali VTC and completion of twin workshop at Busagwa VTC, distributed 216 Sewing Machines to all 27 VTCs across the County. The directorate also trained VTC Managers and Trainers on Competency –Based Education and Training (CBET) Curriculum. 26) The department of Transport, Public Works and Energy initiated the process of reconstructing Sidokho timber foot bridge in Bunyala South ward and Bubamba timber foot bridge in Bunyala central ward. The department also commenced construction of seven road access culverts in Matayos and Teso South sub counties and approximately 70 km of new roads opened under the machine hire arrangement. 27) Further a total 42.25 km of earth roads were maintained through the in-house Programme such as kodurkoit road, kocholia hospital road, railways-komolo road among others 28) In the FY 2022/2023, the department of Lands, Housing and Urban development realized various achievements through its directorates. Through the Municipality of Busia, under the Kenya Urban Support Programme, 0.8 km of Alupe Ring Road has been tarmacked. Furthermore, the department subcontracted 21 firms to manage solid waste across the county. 29) The county department of Water, Irrigation and Natural Resources maintained 14 water systems, installation of 2 storage tanks of 24M3, development of 10 km pipe extension in urban supplies and solarization of Mujini borehole 30) Health and Sanitation department trained a total of 1,850 Community Health Promoters (CHPs) on Community Case Management of Malaria and 876 CHPs trained on Integrated Community Case Management which is a strong community-based component to deliver interventions for diagnostics and treatment to multiple illnesses specifically pneumonia, diarrhea, malaria newborn care and acute severe malnutrition for sick children of families with B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 28 difficult access to case management at health facilities. Further, In collaboration with the National government, the department constructed and operationalized 100 bed capacity a Surgical ward at BCRH. Analysis of Expenditure 31) This section compares actual spending for the fiscal year 2022/2023 to the approved budget to provide an analysis of the two arms of the County Government. County Executive 32) The County Executive allocation for the Financial Year 2022/2023 was Ksh 8.667 billion. The actual spending for the period from July 2022 to June 2023 was Ksh. 6.587 billion, translating to 76% absorption rate. The under absorption was attributed to late disbursement of Exchequer releases, underperformance in own source revenue as well as conditional grants that were pledged but not remitted to the County. County Assembly 33) The County Assembly budget allocation for Fiscal Year 2022/2023 was Ksh. 911.20 million. Ksh 873.32 million was the actual expenditure which equates to an absorption rate of 96%, Allocation Analysis Description. Amount. (Ksh) Percentage County Executive 8,666,685,092 90% County Assembly 911,195,833 10% TOTAL. 9,577,880,925 100% Chart 1: Allocation Analysis County Executive 90% County Assembly 10% B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 29 Absorption Analysis-County Executive and Assembly Description. Budget (Ksh) Absorption. (Ksh) Percentage County Executive 8,666,685,092 6,586,846,002 76% County Assembly 911,195,833 873,322,539 96% TOTAL. 9,577,880,925 7,460,168,541 78% Absorption Analysis-County Executive and Assembly Adherence to fiscal responsibility principles 34) In line with Article 201 of the constitution 2010 and section 107 of the PFM Act 2012 the County Government has adhered to the fiscal responsibility principles as outlined below: I. The county government’s recurrent expenditure shall not exceed the county government’s total revenue; The County Government recurrent expenditure was Kshs.6.22 Billion representing 78 percent of the total actual revenue hence the County complied with the fiscal responsibility principle by the recurrent expenditure not exceeding the total revenue. II. Over the medium term a minimum of thirty percent of the county government’s budget shall be allocated to the development expenditure; Over the medium term the County Government has maintained a minimum allocation of 30 percent on development budget. In the FY 2022/2023 the County allocated 32 percent on development expenditure and expended 1.2 Billion translating to 17 percent of total expenditure for the year under review. 0 1,000,000,000 2,000,000,000 3,000,000,000 4,000,000,000 5,000,000,000 6,000,000,000 7,000,000,000 8,000,000,000 9,000,000,000 Budget (Ksh) Absorption. (Ksh) County Executive County Assembly B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 30 It is worth noting that the low absorption of capital expenditure can be attributed to reduced activities occasioned by the late release of funds, underperformance in Own Source Revenue and non-remittance of some conditional grants for development activities. III. The county government’s expenditure on wages and benefits for its public officers shall not exceed a percentage of the county government’s total revenue as prescribed by the County Executive member for finance in regulations and approved by the County Assembly; In line with section 25(1) (b) of the PFM (County Governments) regulations 2015, County Governments are required not to exceed 35 percent of their total revenue on wages and benefits. In the FY 2022/2023 the County Government allocation on employee compensation was at 34.7 percent which was lower than the stipulated 35 percent. The County’s total expenditure on employee compensation was Ksh. 3.32 Billion of the total expenditure of Ksh. 7.46 Billion this translates to 44.5 percent of the total expenditure. The percentage is attributed to low absorption of development expenditure and underperformance on own source revenue. IV. Over the medium term, the government’s borrowings shall be used only for the purpose of financing development expenditure and not for recurrent expenditure; Over time the County Government has been implementing a balanced budget. In the long run if and when the County incorporates borrowings/public debt in its budget then it shall be used only for capital expenditure. V. The county debt shall be maintained at a sustainable level as approved by county assembly; The County Government has put measures to ensure realistic projections and subsequent collection of own source revenues which include automation of revenue streams. This will ensure implementation of a balanced budget hence reducing recurring pending bills. VI. The fiscal risks shall be managed prudently; The County Government has put forth measures to increase own source revenue collection such as revenue automation and increasing revenue streams and ensure focus on priority programs. VII. a reasonable degree of predictability with respect to the level of tax rates and tax bases shall be maintained, taking into account any tax reforms that may be made in the future. The County Government through preparation of the Finance Act ensured charges, fees and levies are prudently imposed and are in line with the statutory laws. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 31 IV. ANALYSIS OF EXPENDITURE PER DEPARTMENT 1) Agriculture, Livestock and Fisheries 35) The Department of Agriculture, Livestock and Fisheries has a vision to be a Leading County in food security and sufficiency for sustainable livelihoods. 36) The Departments Mission is to improve the livelihoods of Busia County residents through the promotion of competitive agriculture and provision of support services while ensuring a sustainable natural resource base. 37) The department has four directorates namely: Crops, Livestock Production, Veterinary and Fisheries. 38) The departments mandate is to improve livelihood of Busia County residents through promotion of competitive agriculture, sustainable livestock and fisheries. It’s the responsible authority over the entire value chain of crop husbandry, livestock production and fisheries as a fully devolved functions under schedule IV of the Constitution of Kenya. Key Achievements Highlights 39) A total of 459 fish farmers from 5 Aquaculture Business Development Program (ABDP) working sub counties benefited from the supply of 459,000 fingerlings; Butula (80,000), Matayos (80,000), Teso South (115,000), Samia (120,000) and Nambale (64,000). 40) Farmers across the County benefitted from distribution of fish feeds. A total of 3,822 (25 kg) bags of fish feeds were distributed to five sub counties as follows; Matayos 666 (25 kgs) of bags; Butula 666 (25 kgs) of bags, Teso South 957 (25 kgs) of bags, Nambale 534 (25 kgs) of bags and Samia 1000 (25 kgs) of bags. 41) Further, 183,000 fingerlings and 15,000 kgs of fish feeds were supplied to small holder cage farmers as a measure of reducing fishing pressure in the lake and providing alternative livelihood for the fisher folk, two aquaparks (Kamarinyang’, Siunga) Completed and stocked 42) To strengthen evidence-based planning and budgeting, the directorate of Livestock in collaboration with State Department for Livestock and KALRO conducted a Livestock Census for Busia County for the purposes of Developing a Livestock Master Plan. A total of 86,812 households were listed as livestock farming households in Busia County. 43) In addition, 8,684 farmers trained on livestock husbandry practices and innovations in collaboration with ASDSP, KCSAP and other partners. 44) The Directorate of Livestock established 28 acres of fodder as a result of 50 kg of Bhoma Rhodes seeds and bracharia splits Procured. 45) To increase tonnage of poultry meat produced, the directorate of livestock through KCSAP operationalized the poultry parks which led to increase in annual poultry meat produced by B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 32 10%. The Out-grower units have production capacity of 144 tons annually valued at Ksh 57.6 million. 46) The directorate of vetenary completed the construction of 7 Crush Pens at (Ang’urai North- Adumai, Malaba Central-Awata Bukhayo North-Khwirale, Amukura Central-Apatit, Namboboto-Khabondi, Bunyala North Mumoni & Budubusi and 2 cattle dips, Mayenje (Mayenje ward) and Changara (Angurai East ward) have been completed and are operationalized. 47) The mass vaccination compaign conducted led to a total of 34,774 cattles, 2,039 sheep and 4,759 goats vaccinaated against FMD, LSD & Blanthrax, 48) A total of 8.4 tons of certified maize seed was procured and distributed to farmers which translated to 840 acres of land being planted with a projected yield of 6,720 of 90Kg bags of maize. 49) In addition, 346 (50 kgs) bags Top dressing fertilizer (CAN) was procured and distributed to farmers in Busibwabo ward. This aimed to increase productivity of maize. 50) The department procured 700 sachets of 50 grams spider plant seeds and distributed to horticulture farmers which was projected to have 70 acres of land under spider plant vegetables. The project was aimed to address micro nutrient deficiency and household incomes. 51) Further, 1,195 liters of pesticides were procured and distributed to farmers across the county. This aimed at reduction of crop loss by attack and spread from African army worm and fall army worm. Recent Economic Development in the Department 52) The department has aligned itself to the Bottom Up Economic Transformation Agenda of agriculture transformation by focusing on agro-processing, increasing market participation and value addition supported by establishment of Industrial park at Nasewa, revival of Mulwanda cotton Ginnery and Gazettement of EPZ zone. 53) It’s shifting its focus from fragmented production to aggregated production through establishment of aquaparks, poultry parks and dairy parks with the aim of increasing production and ensuring food security. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 33 Risk to the Outlook 54) The risks to the outlook over the Medium-Term include weak internal control systems within the revenue collection and complacency of the citizens. Tackling these issues will reduce the risk and increase revenue collections 55) Public expenditure pressures, especially recurrent expenditures, pose a fiscal risk. Wage bill pressures and the need to hire more personnel limit funding for development expenditure. 56) The County Government will undertake appropriate measures to safeguard fiscal stability should these risks materialize by mitigating against them. 57) In the FY 2022/2023, the total approved budget for the department amounted to Ksh 1,376,680,410which constituted to 14% of the overall budget. This comprised of Ksh 1,101,744,545 (81%) allocated to development expenditure and Ksh 274,935,865 (19.3%) allocated to recurrent Expenditure. Table 3: Allocation Analysis by Economic Classification No. Description. Amount.(Ksh ) Percentage. 1 Employee Compensation 188,121,056 13 2 Operations and Maintenance. 86,814,809 6 3 Development. 1,101,744,545 81 TOTAL. 1,376,680,410 100 Chart 2: Allocation Analysis Employee Compensation, 13% Operations and Maintenance., 6% Development., 81% Employee Compensation Operations and Maintenance. Development. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 34 58) Development budget allocation was the highest with an allocation of 81%, Personnel Emolument was second with an allocation of 15%, while Operations and maintenance was the least with an allocation of 4%. Table 4: Absorption Analysis No. Description. Budget(Ksh ) Absorption.(Ksh ) Percentage. 1 Employee Compensation 188,121,056 184,120,435 98% 2 Operations and Maintenance. 86,814,809 82,611,885 95% 3 Development. 1,101,744,545 540,043,683 49% TOTAL. 1,376,680,410 806,776,003 58.60 Graph 6: Absorption Analysis- Agriculture, livestock and Fisheries. 59) The total absorption was Ksh 806.7 million representing 59% of the total departmental budget. Development vote absorption was at 49%. The department utilization of the Personnel Emoluments was at 98% while Operations and Maintenance absorption was at 95%. 0 200,000,000 400,000,000 600,000,000 800,000,000 1,000,000,000 1,200,000,000 Employee Compensation Operations and Maintenance. Development. Budget(Ksh ) Absorption.(Ksh ) B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 35 2) Trade, Investment, Industry and Cooperatives 60) The vision of the department is to be a leading department in the promotion of trade, co- operative movement and investment. 61) The mission is to foster inclusive and sustainable socio-economic development through promoting investment in trade, entrepreneurship, innovations, value addition and co-operative development. 62) The Department's mandate is to facilitate and promote the development of trade and cooperative activities. This objective is achieved through the implementation of various programs aimed at diversification, innovation, value addition, information sharing, market linkages, and trade infrastructure support. 63) The sector comprises four directorates, namely Trade, Cooperatives, Industry, and Investments. 64) The Trade directorate plays a crucial role in facilitating the growth of business enterprises countywide. It is responsible for the development and coordination of businesses across the county. 65) The Cooperatives directorate focuses on supporting and advancing cooperative societies' development throughout the county. Meanwhile, the Industry directorate is responsible for promoting and establishing industries within the county. 66) The department also aims to promote self-reliance through the Investments Directorate. This is achieved by implementing various programs that target diversification, innovation, value- addition, information sharing, market linkages, and support for trade infrastructure. Ultimately, the department's objective is to enhance business, employment, and wealth creation in the county. 67) In the year under review, the department commenced the development of County Aggregation and Industrial Park (CAIP) at Nasewa as one of the flagship projects of the County. 68) The directorate of Trade initiated the formulation of County Investment Policy, which plays a crucial role in operationalization of the Industrial Park, Export Processing Zone and guiding other investment programs. 69) The directorate of Trade in collaboration with Trade Mark Africa (TMA) constructed and commissioned the Modern Busia Soko-Posta safe market with a capacity of 160 stalls that were allocated to traders who were affected by the beautification and reorganization exercise within the Busia municipality. 70) The directorate of Cooperatives has formulated County Cooperatives Policy and a County Cooperatives Bill in order to regulate cooperatives activities within the County. To implement B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 36 the County’s Rural Economic Revitalization strategy, the directorate has also started the promotion and facilitation of registration of Ward-based multi-chain cooperative societies. 71) The Weights and Measures directorate has ensured fair trade practices within the county. Verification of weighing and measuring equipment in use for trade within the county was performed leading to uniformity and accuracy in trading practices. 72) In the year under review 1,160 traders weighing and measuring trading equipment were verified and 22 random inspections on business premises was done to ensure conformity. 73) In the medium term, the department intends to complete the county industrial park, establish 47 new markets and renovate 15 markets, set up 1 cotton ginning factory and disburse 300M to cooperatives to support Bottom-up Economic Transformation Agenda (BETA) policy of “One ward one cooperative”. 74) In FY2022/2023, the reorganization and beautification of Busia Municipality and its surroundings had a negative impact on the business community, leading to a decline in revenue collection from the sector. 75) The reallocation of funds intended for market modernization and development to the County Aggregation and Industrial Park also had a detrimental effect on the implementation of other prioritized areas. 76) The department was allocated Ksh. 310.336M. This constituted 3.78% of the total budget. The budget for the department was divided as follows; Allocation analysis by economic classification-Trade No. Description. Amount. (Ksh) Percentage. 1 Employee Compensation 35,735,751 11.52% 2 Operations and Maintenance. 50,244,797 16.19% 3 Development. 224,354,992 72.29% TOTAL. 310,335,540 100.00% B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 37 Allocation Analysis 77) Development allocation was the highest with an allocation of 72%, Operations and maintenance got the second largest allocation of 16% while employee compensation got an allocation of 11.2%. Absorption Analysis No. Description. Budget(Ksh ) Absorption.(Ksh ) Percentage. 1 Employee Compensation 35,735,751 35,485,751 99.30% 2 Operations and Maintenance. 50,244,797 49,679,832 98.88% 3 Development. 224,354,992 124,707,279 55.58% TOTAL. 310,335,540 209,872,862 67.63% Absorption Analysis Employee Compensation 12% Operations and Maintenance. 16% Development. 72% - 50,000,000 100,000,000 150,000,000 200,000,000 250,000,000 Employee Compensation Operations and Maintenance. Development. M ill io n s Axis Title Budget(Ksh ) Absorption.(Ksh ) B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 38 78) The total absorption was Ksh.132.36M representing 41% of the total departmental budget. Personnel cost vote was the highest utilized with 100%. The department utilized operations and maintenance vote at 74% while development was the least utilized vote with 28%. 3) Education and Vocational Training 79) The vision of the department is to provide quality education and training for all to transform Busia into an intelligent County in the frontline of global progress and innovation. 80) The department’s mission is to provide accessible, holistic and quality Education Training to all, for the Socio Economic and Sustainable Development of Busia County and for Self- reliance and innovativeness in an increasingly globalized environment. 81) The Constitution of Kenya 2010 Article 43(f) guarantees each person the right to education. Article 53 provides for free and compulsory basic education to all children, basic nutrition, shelter, and health care. Equally, Sustainable Development Goals (SDGs) were adopted by all United Nations member states in 2015 as a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity by 2030. SDG No. 4 seeks to ensure inclusive and equitable quality education and promote lifelong learning opportunities for all. 82) The department comprises of two directorates; Early childhood Education and Vocational Training. 83) The Directorate of Early Childhood Development Education is mandated to undertake the following tasks: supervision of ECDE curriculum implementation; assess growth; monitoring and development of ECDE children; collect data for purposes of equitable distribution of resources; capacity building of ECDE teachers and improving the physical environment of the ECDE children through construction of classes and provision of outdoor play equipment. 84) The Directorate of Vocational Training is mandated to undertake Management of Vocational Training Centers through: development of policy guidelines; rules and regulations; implementation of policies; implementation of programmes supported by various development partners; supervision and management of vocational training centers staff; implementation of Quality Assurance and Standards (QAS), recommendations and promotion of ICT integration and youth innovations; management of instructors and development of the human resource in the vocational centers. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 39 85) In the FY 2022/2023 the Directorate of Early Childhood Education trained teachers on Pedagogy teaching approach hence giving teachers an insight into the best practices for a classroom setting and also allow them to understand how different students learn hence improving the quality of teaching and learning. In collaboration with Child Fund, ECDE Capitation policy was developed and approved by Busia County Assembly which will help in Equipping of our ECDE Centers with appropriate teaching and learning materials. The directorate also supported ECDE Learners in Co-curricular activity up to National Level. 86) Vocational Training directorate initiated the process of construction of Administration block phase II at Katakwa and Namasali VTC and completion of twin workshop at Busagwa VTC, distributed 216 Sewing Machines to all 27 VTCs across the County. The directorate also trained VTC Managers and Trainers on Competency –Based Education and Training (CBET) Curriculum. 87) In FY 2022/2023, the department had a total allocation of Ksh. 676,684,425 constituting 7.07% of the total budget (Ksh.9,577,880,925). Out of this allocation, Ksh. 622,835,677 went to recurrent expenditure and ksh. 53,848,748 to development expenditure. Table 5: Allocation analysis by economic classification-Education and Vocational Training No. Description. Amount.(Ksh ) Percentage. 1 Employee Compensation 373,925,209 55.26% 2 Operations and Maintenance. 248,910,468 36.78% 3 Development. 53,848,748 7.96% TOTAL. 676,684,425 100% Chart 3: Allocation analysis Employee Compensation 55% Operations and Maintenance 37% Development 8% Employee Compensation Operations and Maintenance Development B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 40 88) Personnel Emolument budget allocation was the highest with an allocation of 55%. Operations and maintenance was second with 37% while Development was the least with an allocation of 8%. Table 6: Absorption analysis No. Description. Budget(Ksh ) Absorption.(Ksh ) Percentage. 1 Employee Compensation 373,925,209 373,925,209 100% 2 Operations and Maintenance. 248,910,468 243,911,688 98.0% 3 Development. 53,848,748 13,491,401 25.1% TOTAL 676,684,425 631328298 93.3% Graph 7: Absorption analysis-Education and Vocational Training 89) The total absorption was Ksh 631.33M representing 93% of the total departmental budget. Development vote absorption was at 25%. The department utilization of the Personnel Emoluments was at 100% while Operations and Maintenance absorption was at 98%. 4) Finance, ICT and Economic Planning 90) The department comprises of Finance, ICT and Economic Planning. Finance Section consists of four directorates namely; Budget, Accounting Services, Revenue and Supply Chain management. 91) Budget directorate is responsible for preparation of County budget estimates, Supplementary budget estimates, County Budget Review & Outlook Paper, County Fiscal Strategy Paper, 0 50,000,000 100,000,000 150,000,000 200,000,000 250,000,000 300,000,000 350,000,000 400,000,000 Employee Compensation Operations and Maintenance. Development. Budget(Ksh ) Absorption.(Ksh ) B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 41 Popular Citizen Budget, Debt Management Strategy Paper and other vital planning documents. 92) Accounting services is mandated to undertake payments and production of financial reports, Directorate of Revenue is responsible for collection and supervision of own- source local revenue, finally the directorate of Supply chain management deals with procurement of goods and services for various county entities. 93) Economic Planning section consists of Planning, Internal Audit and Monitoring & Evaluation Directorate. Planning directorate is responsible for preparation of planning documents and statistical data, Audit directorate is responsible for carrying out internal audits at the County entities for reporting purposes on County projects to ensure value for money is realized. Monitoring & Evaluation unit is responsible for continuous monitoring of County projects during the implementation phase as well end term evaluation to assess the impact of projects. 94) In the year under review FY 2022/23, the department focused on its mandates by having quality financial, economic and advisory services, for instance, budgeting and planning was timely done as per the set timelines hence enabling implementation of county priority programs and projects across various departments. Technical support, advice and guidance on fiscal and budgetary matters was availed to all stakeholders in the County. 95) Accounting services managed to produce financial reports, through proper control and accounting for receipt and expenditure of public funds 96) The directorate further developed financial policies and procedures, administration of applicable legislation, timely preparation of financial statements and financial reports. 97) Through the directorate of revenue, automation systems were adopted to effectively and efficiently collect revenue from various revenue streams/sources. 98) The directorate of Supply chain management adopted e-procurement as a method of procuring goods and services. 99) Audit directorate prepared quarterly reports which were later submitted to the Auditor General. 100) In conclusion the department is committed to ensure that prudent financial management and economic planning is adhered to and in conformity with Public Finance Management Act, 2012, County Government Regulation, 2015 and Public Procurement & Asset Disposal Act, 2015 101) The department was allocated Ksh. 969,716,542 which constituted 10.12% of the overall budget. This constitutes of Ksh. 74,758,820 (7.71%) as development allocation and Ksh. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 42 894,957,772 (92.29%) as recurrent allocation. The budget for the department was divided as follows: Table: Allocation Analysis by Economic Classification No. Description. Amount. (Ksh) Percentage. 1 Employee Compensation 433,673,627 44.72% 2 Operations and Maintenance. 461,284,095 47.57% 3 Development. 74,758,820 7.71% TOTAL. 969,716,542 100.0% Chart: Allocation Analysis 102) Operations and maintenance budget allocation was the highest with an allocation of 47.57%. Personnel Emolument was second with 44.72% while Development was the least with an allocation of 7.71% Table: Absorption Analysis No. Description. Budget(Ksh ) Absorption.(Ksh ) Percentage. 1 Employee Compensation 433,673,627 433,665,305 99.99% 2 Operations and Maintenance. 461,284,095 458,033,940 99.30% 3 Development. 74,758,820 1,665,952 2.23% TOTAL. 969,716,542 893,365,197 92.13% Employee Compensation 45% Operations and Maintenance. 47% Development. 8% B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 43 Graph: Absorption Analysis 103) The total absorption was Ksh 893.37M representing 92% of the total departmental budget. Development vote absorption was at 2%. The department utilization of the Personnel Emoluments was at 100% while Operations and Maintenance absorption was at 99%. 5) Sports, Culture and Social Services 104) The vision of the department is to be a socially, self-driven and empowered community 105) The department’s mission is to mobilize the Busia community for sustainable social protection, talent nurturing, heritage presentation and creating equal opportunity for children, youth, women, PLWD’S, older persons and other vulnerable groups for holistic growth and development. 106) The department has six directorates namely: Sports, Culture, Social Services, Youths, Child Protection and Alcoholic Drinks and Drug use Control. 107) It is mandated to mobilize Busia Community for sustainable social protection, talent nurturing and creating equal opportunity for youth, women, PLWDs, older persons and other vulnerable groups for holistic growth and development. 108) The Department of Sports and Culture has accomplished several significant milestones in enhancing community development and nurturing talent. It refurbished a community social hall, providing a modern and functional space for cultural and social gatherings. 109) The department realized its objective of sports promotion and development by supporting the County staff to participate in the Kenya Inter County Sports and Cultural Association (KICOSCA). This nurtures talent and promotes integration among counties. 0 100,000,000 200,000,000 300,000,000 400,000,000 500,000,000 Employee Compensation Operations and Maintenance. Development. Finance and Economic Planning-Absorption Budget(Ksh ) Absorption.(Ksh ) B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 44 110) Additionally, the department operationalized the Nambale Youth Empowerment Centre, which has become a center of opportunity and growth for young individuals, offering mentorship, career guidance, and skill-building programs for youths. 111) Through specialized training initiatives, the department empowered youths with entrepreneurship and business development skills, fostering economic independence of the youth. Furthermore, the department organized vibrant community cultural festivals, celebrating the diverse traditions and heritage of the different communities in the county, promoting unity and inclusivity. 112) In the medium term, the department seeks to complete on-going infrastructural works being undertaken.These include; Completion, equipping and operationalization of community cultural centres ( Kakapel & Bumbe), Construction of Busia County Modern Library, refurbishment of Busia County Stadium, upgrading of Sub County stadia, construction of public daycare, and establishment of recreation and leisure park in Busia town. 113) The department encountered various challenges during its operations, including insufficient funding, irregular releases of funds by the national government creating additional financial strain, lengthy procurement processes, as well as issues with the functionality of the Integrated Financial Management Information System (IFMIS) further worsened the challenges. Furthermore, delays by contractors and service providers in executing their contracts had a damaging impact on development efforts. 114) The department was allocated Ksh.178 million, this constituted 1.86% of the total budget. The budget for the department was divided as follows; Allocation analysis by economic classification No. Description. Amount. (Ksh) Percentage. 1 Employee Compensation 34,572,775 19.42% 2 Operations and Maintenance. 81,668,115 45.87% 3 Development. 61,790,896 34.71% TOTAL. 178,031,786 100.00% B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 45 115) Operations and Maintenance allocation was the highest at 46%, Development was allocated 35% and Personnel cost (Compensation to employees) at 19% of the total departmental budget. Employee Compensation 19% Operations and Maintenance. 46% Development. 35% Employee Compensation Operations and Maintenance. Development. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 46 Table: Absorption analysis No. Description. Budget (Ksh) Absorption. (Ksh ) Percentage. 1 Employee Compensation 34,572,775 33,072,775 95.66% 2 Operations and Maintenance. 81,668,115 63,311,860 77.52% 3 Development. 61,790,896 25,368,815 41.06% TOTAL. 178,031,786 121,753,450 68.39% 6) Transport, Public works and Energy 117) The vision of the department is to develop quality, reliable, sustainable and resilient infrastructure and provide access to safe affordable public transport systems. 118) The department’s mission is to expand public transport and build infrastructure with special attention to the needs of women, children and people living with disability (PLWDs) through production of appropriate designs and increase investment. 119) The department is made up of four directorates namely; Roads, Public works, Transport and Energy. 120) The directorate of roads, public works and transport are mandated to provide an enabling and supportive environment for investment in the County and sustain standard road network and public infrastructure for sustainable development. The energy directorate is mandated to ensure available and sufficient lighting in the Urban centres and Rural areas which is critical in enhancing security and business activities across the county. It provides both technical and supervisory assistance to other departments in implementation of projects. 121) In the year under review, the directorate of roads implemented its major activities which include; construction of box culverts and bridges, routine maintenance of county roads at departmental and ward level. - 20,000,000 40,000,000 60,000,000 80,000,000 100,000,000 Employee Compensation Operations and Maintenance. Development. M ill io n s Axis Title Budget(Ksh ) Absorption.(Ksh ) B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 47 122) The construction and completion of box culverts and bridges have connected rural inaccessible areas of the county hence increasing access of agricultural produce to markets as well as other socio- economic centers. 123) The department undertook the following programmes; approximately 70 km of new roads opened under the machine hire arrangement, 42.25 km of earth roads were maintained through the in-house Programme i.e kadurkoit road, kocholia hospital road, railways-kamolo road among others. It also oversaw the construction of Busia bus park which is at the tail end of construction. 124) The directorate of public works commenced the process of reconstructing Sidokho timber foot bridge in Bunyala South ward and Bubamba timber foot bridge in Bunyala central ward. The department also commenced construction of seven road access culverts in Matayos and Teso South sub counties. 125) The transport and fleet management section procured assorted spares for graders, bulldozers, rollers, tippers and excavators and centralized bulk fueling. Further plans are underway to install fleet management software for the management of transport and use of fuel cards for efficient management of fuel for all county vehicles. 126) The directorate of energy commenced maintenance of solar mass lights in Amukura East, Angurai North, Bukhayo Central, Bukhayo North, Marachi North, Marachi West, and Kingandole wards which are still ongoing. 127) The directorate also completed designs for all REREC projects for the F/Y 2020-2021 after funds were transferred to the REREC account. The projects will be implemented to completion in the current financial year. 128) Some of the key challenges experienced are; Inadequate staff personnel i.e., surveyors and sand harvesting along road sides which undermine roads and drainage structures such as culverts leading to severe destruction of roads by surface run off and expensive remedial works. 129) Lack of axle load control (weigh bridge) on county roads leading to overloading especially by cane and building material transporters which causes pre mature failure of gravel roads. 130) Low machine hire services due to frequent breakdowns that have made the department fail in generating revenue for development and lack of laboratory for testing materials. 131) The roads directorate seeks to establish a revolving fund for mechanical and transport functions to assist in timely maintenance of the equipment and acquisition of new fleet and equipment tyres that are not yet acquired e.g., backhoe loader. 132) The department was allocated Ksh. 566,737,832 which constituted 6% of the overall budget. This constituted Ksh. 365,644,618 (65%) as development allocation and Ksh. 201,093,214 (35%) as recurrent allocation. The budget for the department was divided as follows: B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 48 Table 7: Allocation analysis by economic classification-Infrastructure and Energy No. Description. Amount.(Ksh ) Percentage. 1 Employee Compensation 102,166,665 18% 2 Operations and Maintenance. 98,926,549 17% 3 Development. 365,644,618 65% TOTAL. 566,737,832 100.00% Chart 4: Allocation analysis- Infrastructure and Energy 133) The development cost allocation was the highest at 65%. Personnel cost was the second highest with a budget allocation of 18%. The Operations and Maintenance was the least beneficiary with 17%. Table 8: Absorption analysis No. Description. Budget(Ksh ) Absorption.(Ksh ) Percentage. 1 Employee Compensation 102,166,665 102,133,725 100% 2 Operations and Maintenance. 98,926,549 95,211,334 96% 3 Development. 365,644,618 257,249,649 70% TOTAL. 566,737,832 454,594,708 80% Employee Compensation 18% Operations and Maintenance. 17%Development. 65% Employee Compensation Operations and Maintenance. Development. B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 49 Graph 8: Absorption analysis 134) The total absorption was Ksh. 454,594,708 representing 80% of the total departmental budget. Development vote absorption was at 70%. The department utilization of the Personnel Emoluments was at 100% while Operations and Maintenance absorption was at 96%. 7) Public Service Administration and Gender 135) The vision of the department is to be a benchmark for high performing, dynamic and ethical public service. 136) The mission of the department is to facilitate a safe environment for an effective and productive work force that guarantees personal growth and sustainable development. 137) The Department of Public Service, Administration and Gender is composed of five sections namely; Human Resource Management and development, Payroll Management, Gender affairs, Records and Administration. 138) In discharging its function, the department liaises with the County Public Service Board in coordinating Human Resource and Records Management functions. 139) The Mandate of the Department is to undertake the following; Human Resource management and Development, Records Management, Staff Performance Management, Training and Capacity Building, Organizational Design and Development, Industrial relations, Gender/Disability Mainstreaming, Staff Benefits and Welfare Schemes, Guidance and Counselling on HIV and AIDs, Employee relationship, Promotion of Staff Cohesion and Staff Payroll Management. 0 50,000,000 100,000,000 150,000,000 200,000,000 250,000,000 300,000,000 350,000,000 400,000,000 Employee Compensation Operations and Maintenance. Development. Budget(Ksh ) Absorption.(Ksh ) B u s i a C o u n t y B u d g e t R e v i e w a n d O u t l o o k P a p e r 2 0 2 1 : Page | 50 140) The Strategic goal, plan, target and objective of the department is to provide a conducive environment for an effective and efficient workforce while embracing modern technology for delivery of quality service. 141) The department’s key achievements included ensuring adherence to HR policies and laws, revamped performance contracting, trained staff on alcohol, drug and substance abuse, conducted pre- retirement training, management of staff pension, promoted staff cohesion by ensuring fair labour practices, ensured staff do not earn below a third of their basic salaries, facilitated staff with disabilities to obtain tax exemption certificates, sensitized staff on proper records management and reduced salary payments outside the IPPD. 142) The following were challenges faced; Inadequate working space, tools and equipment for staff, insufficient Budgetary allocation hence limiting the scope for service delivery as most programs are underfunded, insufficient workforce hence limiting the performance output per staff as most staff are overworked. Mobility challenges that include lack of motor vehicles and motor cycles for supervision. 143) As a way forward, the department recommends the following; ➢ Prudent use of allocated resources. ➢ Early Planning should be adhered to so as to ensure the intended purposes for funding is achieved. ➢ Construction of Sub County Headquarters that can accommodate County staff at the Sub County Level. ➢ Construction of model ward offices to avoid renting shops. ➢ Purchase one vehicle per sub county and motor bikes for wards and village administrators. ➢ Provide adequate budget for office operations and capacity building. ➢ Recruitment of casual support staff to assist village administrators. ➢ Timely disbursement of