COUNTY GOVERNMENT OF ELGEYO MARAKWET THE COUNTY TREASURY 2024 COUNTY FISCAL STRATEGY PAPER (CFSP) FEBRUARY 2024 © County Fiscal Strategy Paper (CFSP) 2024 To obtain copies of the document, please contact: The County Treasury P. O. Box 220-30700 ITEN, KENYA Email: emcounty2013@gmail.com, governor@elgeyomarakwet.go.ke Website: www.elgeyomarakwet.go.ke 2024 CFSP Submitted to County Assembly ii FOREWORD I am delighted to present the 2024 County Fiscal Strategy Paper (CFSP), a crucial document that charts the course for Elgeyo Marakwet County's fiscal journey in the upcoming financial years. This marks the second CFSP prepared under the current administration, reflecting our commitment to realizing the developmental objectives outlined in the 2023-2027 County Integrated Development Plan (CIDP III). The 2024 CFSP serves as a strategic roadmap, aligning the county's priorities with the national objectives outlined in the 2024 Budget Policy Statement (BPS) for the 2024/25 Financial Years. In the backdrop of a national economic slowdown, heightened inflation, and the challenges posed by national debt repayments, this document carefully navigates the fiscal landscape, acknowledging the need for prudence and adaptability. However, the fiscal space presents challenges, including a slight increase in allocated funds to counties. In response, the Elgeyo Marakwet County Government has devised strategies to optimize resources. The reorganization of budget priorities within the 2024 CFSP reflects our dedication to achieving county strategic focus areas and BETA objectives. Also, focus will be put on revamping Own Source Revenue (OSR) management to enhance the revenue base and thus sustain the delivery of services. This will be strengthened through scaling up the use of technology to enhance efficiency in collections and seal leakages. In recognition of the need for fiscal prudence, we are actively working towards reducing the wage bill pressure on the county resource envelope. In the upcoming 2024/25 Fiscal Year, we project a significant drop, bringing the wage bill percentage down to 43.45%. This reduction reflects our dedication to achieving a more sustainable balance between maintaining a capable workforce and adhering to fiscal regulations. The 2024 CFSP also underscores the importance of effective budget implementation, emphasizing value for money and prudent financial management. Streamlining expenditure processes and embracing automation in crucial areas such as drugs management, procurement, revenue collection, and project management are central to our efforts. 2024 CFSP Submitted to County Assembly iii The 2024 CFSP is a product of objective reviews, considering departmental capacities, outcomes, public input, and adherence to financial regulations. As the county embarks on this fiscal journey, its focus is on delivering quality services, fostering economic growth, and realizing the vision of transformative leadership through accountable governance. ALPHAEUS K. TANUI CECM FINANCE AND ECONOMIC PLANNING 2024 CFSP Submitted to County Assembly iv ACKNOWLEDGEMENTS The completion of the 2024 County Fiscal Strategy Paper (CFSP) has been a collaborative effort, and we extend our heartfelt gratitude to all those who played a crucial role in its development. This CFSP serves as a cornerstone in our organization's financial planning and decision-making processes, and the dedication of numerous individuals has made it a comprehensive and actionable guide. Our sincere appreciation goes to the entire team whose insightful ideas, meticulous analysis, and attention to detail have been instrumental in shaping the content of this plan. The participatory nature of this process, involving all County Departments led by respective CECMs, Chief Officers, Directors, and staff, highlights the collective commitment to the success of the CFSP. Special recognition is due to the core team of technical staff from the Department of Finance and Economic Planning; the Directorate of Economic Planning and Budgeting, for their diligent efforts in collecting, collating, and analyzing departmental findings. Their expertise has been invaluable in ensuring the quality and reliability of the data underpinning this strategic document. We extend our thanks to the County Executive Committee led by H.E Governor Wisely Rotich, whose visionary leadership has provided crucial policy direction and guidance. This guidance aims to align the CFSP’s strategies with the county’s long-term development aspirations outlined in the County Integrated Development Plan (CIDP) 2023-2027. The collaborative spirit exhibited by all departments during the input phase of the draft 2024 CFSP is highly commendable. As we move forward, it is our shared vision to ensure efficient and effective service delivery, coupled with sustainable development. The 2024 CFSP will be a guiding document, steering our government's development strategies in the upcoming 2024/25 Fiscal Year. Thank you to everyone involved for your commitment, dedication, and invaluable contributions. PETER CHESOS CHIEF OFFICER FINANCE AND ECONOMIC PLANNING 2024 CFSP Submitted to County Assembly v ABBREVIATIONS AiA Appropriation in Aid ADP Annual Development Plan BPS Budget Policy Statement CAIP County Industrial & Aggregation Park CBA Collective Bargaining Agreement CECM County Executive Committee Member CFSP County Fiscal Strategy Paper CIDP County Integrated Development Plan COVID-19 Coronavirus 2019 CRA Commission on Revenue Allocation CRF County Revenue Fund ECDE Early Childhood Development Education EDA Equitable Development Act FY Financial Year FIF Facility Improvement Financing FLLoCA Finance Locally Led Climate Action Program GDP Gross Domestic Product KRA Kenya Revenue Authority ICT Information Communication Technology ICRMS Integrated County Revenue Management System KDSP Kenya Devolution Support Program KICOSCA Kenya Inter-County Sports and Cultural Association MTEF Medium Term Expenditure Framework MTP Medium Term Plan VSD Vocational Skills Development OSR Own Source Revenue O&M Operations and Maintenance 2024 CFSP Submitted to County Assembly vi PFM Public Finance Management SRC Salaries and Remuneration Commission BETA Bottom-Up Economic Transformation Agenda DANIDA Danish International Development Agency 2024 CFSP Submitted to County Assembly vii TABLE OF CONTENTS ABBREVIATIONS vi TABLE OF CONTENTS viii LIST OF TABLES x x LIST OF FIGURES xi CHAPTER ONE: INTRODUCTION 12 1.0 Overview 12 1.1 Legal Framework for County Fiscal Strategy Paper (CFSP) 13 1.2 Fiscal Responsibility Principles for the County Government 14 1.3 Development Allocations Guidelines 15 CHAPTER TWO: RECENT ECONOMIC DEVELOPMENTS AND MEDIUM-TERM OUTLOOK 17 2.1 Overview 17 2.2 Recent Economic Developments and Outlook 17 2.2.1 Global and Regional Economic Developments 17 2.2.3 External Sector Developments 19 2.3 National Fiscal Policy 20 2.4 Economic Outlook 21 2.4.1 Risks to the Economic Outlook 22 CHAPTER THREE: COUNTY FISCAL POLICY 23 3.1 Overview 23 3.2 CFSP Alignment to Budget Policy Statement 23 3.5.1 Growth Prospects and Challenges 25 3.5.2 Risks to Fiscal Outlook in the County 25 CHAPTER FOUR: COUNTY BUDGET FRAMEWORK 27 4.1 Fiscal Performance of County Governments in FY 2022/23 27 4.1.1 County Governments’ Own-Source Revenue (OSR) 27 2024 CFSP Submitted to County Assembly viii 4.1.2 County Governments’ Budget Absorption 29 4.3 FY 2023/2024 ABSORPTION RATES 32 4.4 FY 2023/2024 EXPENDITURE 33 4.4.1 RECURRENT EXPENDITURE 33 4.4.1.1 PERSONAL EMOLUMENTS (PE) EXPENDITURE 33 4.4.1.2 OPERATIONS AND MAINTENANCE 34 4.4.1.3 OVERALL RECURRENT EXPENDITURE ANALYSIS 36 4.4.2 DEVELOPMENT EXPENDITURE 37 4.4.2.1 SUMMARY OF DEVELOPMENT ALLOCATIONS FOR FY 2024/25 37 4.4.2.2 ANALYSIS OF DEVELOPMENT PRIORITIES 38 4.4.3 2024/25 CFSP OVERALL EXPENDITURE ANALYSIS 38 4.5 Resource envelop of the Medium Term 39 4.5.1 Collaboration with National Government and Development Partners 39 4.5.2 Medium-Term Expenditure Estimates 40 ANNEXES 42 Annex 1: Recurrent Departmental Ceilings 42 Annex 2: Development Departmental Ceilings 43 Annex 3: Summary (Recurrent and Development) Departmental Ceilings 44 PART II: EXPLANATORY NOTES 45 2024 CFSP Submitted to County Assembly ix LIST OF TABLES Table 1 : Fiscal Outturn in FY 2022/23 ........................................................................................................ 27 Table 2: County Governments’ Own-Source Revenue (OSR) for period July 2022 to June 2023 (FY 2022/2023).................................................................................................................................................. 28 Table 3: Overall absorption Rates for FY 2022/2023 .................................................................................. 30 Table 4: Revenue Collection for Period July 2023 to Dec 2024 (F/Y 2023/2024) ....................................... 31 Table 5: Recurrent absorption .................................................................................................................... 32 Table 6: Development Absorption .............................................................................................................. 32 Table 7: Personnel Emoluments Analysis ................................................................................................... 33 Table 8: Operations and Maintenance ........................................................................................................ 34 Table 9: Summary of Development Allocation ........................................................................................... 37 Table 10: Analysis of Development Priorities ............................................................................................. 38 Table 11: Overall Expenditure Analysis ....................................................................................................... 38 Table 12: Resource Envelope ...................................................................................................................... 39 Table 13: Medium-Term Expenditure Estimates ........................................................................................ 40 2024 CFSP Submitted to County Assembly x LIST OF FIGURES Figure 1: Domestic Economic Developments ............................................................................................. 18 Figure 2: Annual Real GDP Growth rates .................................................................................................... 19 2024 CFSP Submitted to County Assembly xi CHAPTER ONE: INTRODUCTION 1.0 Overview The County Fiscal Strategy Paper (CFSP) provides strategic direction that shapes the fiscal framework providing priorities and policy objectives. The primary focus of the CFSP is to provide a roadmap for the preparation of budgets for the upcoming financial year and, more broadly, over the medium-term Key Elements of the CFSP include: 1. Strategic Priorities and Policy Goals: At its core, the CFSP enumerates the broad strategic priorities and policy goals that the County Governments aim to achieve. It directs the fiscal decisions and resource allocations towards defined objectives that align with the developmental vision of the county and as aligned to the National 2024 Budget Policy Statement (BPS). 2. Medium-Term Outlook: The CFSP extends its influence over the medium term, offering a forward-looking perspective that transcends a single financial year. By articulating medium-term fiscal priorities, it establishes a coherent and sustainable trajectory for the county's development agenda. 3. Programs, Policies, and Reforms for the Upcoming Financial Year: In its specific application for the 2024/25 financial year, the CFSP outlines priority programs, policies, and reforms that the County Government intends to implement. These initiatives are crafted with a keen eye on addressing current challenges, fostering growth, and enhancing the overall well-being of the county's residents. 4. Alignment with National Priorities: A crucial aspect of the CFSP is its alignment with the national agenda, as reflected in the 2025 Budget Policy Statement (BPS). By aligning with the national government's priorities as contained in the Bottom-Up Economic Transformation Agenda (BETA), the CFSP contributes to a cohesive and coordinated approach to economic transformation and inclusive growth. 5. Linkage to Medium-Term Expenditure Framework (MTEF): The CFSP's influence extends into the Medium-Term Expenditure Framework (MTEF), ensuring that the outlined fiscal strategies are embedded in a realistic and sustainable budgetary framework. This connection strengthens the integration of strategic priorities into the county's financial planning processes. The County Fiscal Strategy Paper serves as an instrument that not only guides budgetary decisions but also embodies the county's commitment to strategic planning, responsible financial management, and alignment with broader national development objectives. It reflects the essence of forward-thinking governance, emphasizing the importance of fiscal prudence and inclusive growth in the pursuit of a thriving and resilient county. 2024 CFSP Submitted to County Assembly 12 1.1 Legal Framework for County Fiscal Strategy Paper (CFSP) The preparation and approval of the County Fiscal Strategy Paper (CFSP) for the 2024 financial year are firmly grounded in the provisions of the Public Finance Management (PFM) Act, specifically in section 117. The legal framework emphasizes various key aspects, ensuring a transparent and participatory process: 1. Timelines and Approval Process: ○ The County Treasury is obligated, in accordance with section 117 of the PFM Act, to prepare and submit the CFSP to the County Executive Committee for approval. ○ The approved CFSP is then submitted to the county assembly by the 28th of February each year, providing a clear timeline for the preparation and approval of this strategic fiscal document. 2. Alignment with National Objectives: ○ The legal framework requires the County Treasury to articulate how the CFSP aligns with national objectives outlined in the Budget Policy Statement. This ensures coherence and synchronization between county and national development goals. 3. Specification of Strategic Priorities: ○ The CFSP is mandated to specify the broad strategic priorities and policy goals that will guide the county government in preparing its budget for the upcoming financial year and over the medium term. This aligns the fiscal strategy with the county's overarching development agenda. 4. Financial Outlook Inclusion: ○ The County Treasury, in preparing the CFSP, must include a comprehensive financial outlook regarding county government revenues, expenditures, and borrowing for the upcoming financial year and over the medium term. This provides a holistic view of the county's fiscal position. 5. Stakeholder Engagement: ○ The legal framework underscores the importance of seeking and considering the views of various stakeholders in the CFSP preparation process. These stakeholders include the Commission on Revenue Allocation, the public, interested persons or groups, and any other forum established by legislation. This participatory approach enhances transparency and inclusivity. 2024 CFSP Submitted to County Assembly 13 6. County Assembly Consideration and Adoption: ○ The county assembly plays a crucial role in the approval process. Not later than fourteen days after submitting the CFSP, the county assembly is required to consider and may adopt it with or without amendments. Any increase or reduction in expenditure is regulated to not exceed one percent of the Vote's ceilings, as indicated by Section 37(1) of the PFM Act 2012 Regulations. 7. Engagement Framework: ○ Section 26(3) of the PFM Act 2012 Regulations outlines an engagement framework between the County Executive Committee Member (CECM) Finance and the Budget Committee of the County Assembly. The relevant committee seeks the views of the CECM Finance on its recommendations before tabling a report for adoption by the County Assembly. 8. Consideration of Recommendations: ○ The County Treasury is required to consider any recommendations made by the county assembly when finalizing the budget proposal for the concerned financial year, promoting collaboration and effective financial planning. 9. Publication and Publicization: ○ The legal framework mandates the County Treasury to publish and publicize the CFSP, ensuring accessibility and transparency in the dissemination of fiscal information. In adherence to these legal provisions, the CFSP process is structured to encourage stakeholder engagement, transparency, and alignment with both county and national development objectives. 1.2 Fiscal Responsibility Principles for the County Government In the pursuit of prudent and transparent management of public resources, the County Government is committed to upholding fiscal responsibility principles as mandated by the Constitution, the Public Finance Management (PFM) Act, 2012, and the PFM regulations. The key fiscal responsibility principles include: 1. Recurrent Expenditure within Total Revenue: ○ The County Government is dedicated to ensuring that its recurrent expenditure does not surpass its total revenue. This principle underscores the importance of fiscal discipline in managing day-to-day operational costs while maintaining financial sustainability. 2024 CFSP Submitted to County Assembly 14 2. Limit on Development Expenditure: ○ Adhering to legal requirements, the County Government aims to keep its development expenditure below thirty percent of the total budget. The 2024- 2025 FY development allocation stands at 33.6% 3. Wage Bill Limitation: ○ Section 25(1)(b) of the PFM (County Governments) Regulations, 2015 stipulates that the County Government's wage bill should not exceed 35 percent of its total revenue. The County’s wage bill stands at The County acknowledges the significance of this principle, but challenges persist due to various factors: ■ Continued pressure on wage bills stemming from the signed 2017 Collective Bargaining Agreement (CBA) agreements between County Governments and health workers. ■ The third Salary cycle review by the Salaries and Remuneration Commission (SRC) for the period 2023/2024-2024/2025. ■ Necessitated recruitment of additional employees to support service delivery for devolved functions. ■ Annual basic pay allowance increments. Despite the challenges in meeting these principles, the County Government remains committed to transparently managing its fiscal affairs, addressing the complexities posed by external factors and making strategic decisions to uphold financial responsibility. Continuous efforts will be directed towards balancing the need for service delivery with the imperative of maintaining fiscal sustainability. 1.3 Development Allocations Guidelines The allocation of development expenditure is guided by a comprehensive set of principles and frameworks, ensuring a fair and strategic distribution of resources. The key guidelines for development allocations are as follows: 1. Equitable Development Act, 2015: ○ Development expenditure allocations adhere to the provisions outlined in the Equitable Development Act of 2015. This legal framework emphasizes fairness and impartiality in the distribution of resources, promoting balanced development across all regions of the county. 2. County Integrated Development Plan (CIDP) and Annual Development Plan (ADP): ○ Allocations are closely tied to the County Integrated Development Plan (CIDP) and Annual Development Plan (ADP). These documents serve as the foundation for identifying development priorities, goals, and projects, ensuring that budget allocations are aligned with the county's long-term vision and annual objectives. 3. Strategic Objectives and Policy Goals in the CFSP: 2024 CFSP Submitted to County Assembly 15 ○ The County Fiscal Strategy Paper (CFSP) sets out strategic objectives and policy goals that guide the allocation of development expenditure. These objectives are formulated in alignment with the 2024 Budget Policy Statement (BPS), providing a coherent and synchronized approach to development planning. 4. Citizen Representation and Participation: ○ Development ceilings for departments and sectors are determined based on the aggregate cost of projects for Wards and County. This approach ensures that the priorities identified at the grassroots level, through citizen representation and participation, are given due consideration. It reflects a commitment to inclusive decision-making in the development planning process. 5. Statutory Framework for Citizen Representation: ○ The allocation process adheres to the statutory framework that promotes citizen representation and participation. This involves mechanisms outlined in the 2024/25 FY Annual Development Plan (ADP), fostering community engagement, and ensuring that the development agenda reflects the needs and aspirations of the local population. 6. Prioritization of Projects: ○ Development ceilings are determined based on the prioritization of projects within departments and sectors. Projects are evaluated and selected through a systematic process that considers the strategic goals of the CIDP, the ADP, and other relevant planning documents. These guidelines establish a transparent and systematic approach to the allocation of development expenditure, integrating legal frameworks, long-term plans, and citizen input. The goal is to foster balanced and inclusive development, ensuring that resources are directed towards projects that align with the county's vision and address the needs of its diverse communities. 2024 CFSP Submitted to County Assembly 16 CHAPTER TWO: RECENT ECONOMIC DEVELOPMENTS AND MEDIUM-TERM OUTLOOK 2.1 Overview Global growth slowed down to 3.0 percent in 2023 and is projected to decline slightly at 2.9 percent in 2024. It is below the historical (2000–2019) average of 3.8 percent. Globally, the economy is experiencing diverse challenges. These challenges include global supply chain disruptions due to heightened geopolitical tensions, weakening demand particularly in China and Eurozone, elevated global interest and exacerbating debt servicing costs and significant losses and damages due to frequent extreme weather events. Additionally, most currencies in emerging market and frontier economies weakened against the U.S. Dollar, mainly due to the tightening of U.S. monetary policy. Inflation in advanced economies has continued to ease, reflecting effects of monetary policy tightening and lower energy prices. Nevertheless, core inflationary pressures remained elevated. Advanced economies are projected to record a slower growth in 2024 compared to 2023. Economic Growth in the emerging market and developing economies is projected to decline relatively modestly, although with notable shifts across regions. In sub-Saharan Africa, growth is projected to decline compared to 2022 reflecting worsening climate change related shocks, inflationary and exchange rate pressures, and domestic supply issues, including, notably, in the electricity sector. 2.2 Recent Economic Developments and Outlook 2.2.1 Global and Regional Economic Developments Global economic outlook has become more uncertain - reflecting the impact of the ongoing Russia-Ukraine conflict, elevated global inflation, the lingering effects of post COVID-19 pandemic, and increased oil prices across the globe. Global growth is projected to slow down to grow from 3.1% in 2023 to 3.2% in 2024. The USA real GDP growth is projected to slow down marginally from 2.5% to 2.4 %in 2023. Over 2023, Europe’s economy grew by 1%; Of these, European Union and Eurozone countries grew by 0.7% each, while Eastern Europe countries grew by 1.6%. China's economy is projected to drop even further from the 5% growth recorded in 2023 to 3.5% growth in 2024 due to declining production from an aging population. In the sub-Saharan Africa region, growth is projected at 4.2 percent in 2024 up from a growth of 3.6 percent in 2023. The growth is attributed to an increase in real GDP stemming from increased private consumption and investment. 2024 CFSP Submitted to County Assembly 17 Figure 1: Domestic Economic Developments Source of Data: Kenya National Bureau of Statistics The Kenyan economy has remained resilient with real GDP growth of 5.5% in 2023 and is further projected to grow by 5.5% in 2024, primarily fueled by the expansion of services and increased household consumption. Like numerous nations globally, Kenya encountered inflationary challenges due to fluctuations in commodity prices. Additionally, there were challenges from volatile global financing conditions, leading to significant pressure on the exchange rate and foreign exchange reserves. The situation was exacerbated by the most severe drought in four decades, resulting in heightened food insecurity and impacting millions of livelihoods. In response to this complex economic environment, macroeconomic policies were implemented to find a balance. This involved adopting greater exchange rate flexibility, fiscal consolidation, and a more stringent monetary policy. Despite the interruption caused by the pandemic, Kenya persisted with fiscal consolidation efforts initiated in previous years to address mounting debt sustainability concerns. These measures, continued into 2022, contributed to the reduction of external and domestic imbalances. Inflation is anticipated to reduce from 6.7% in 2023 to 5.9% in 2024, driven by reduced inflation in food and energy prices. The monetary policy is anticipated to remain stringent in 2024. The fiscal deficit is projected to decrease from 5.6% of the GDP in 2023 and further to 5.4% in 2024, aligning with the fiscal consolidation trajectory. The current account deficit is estimated to narrow down to 5.2% of GDP in 2023 and 5.0% in 2024, owing to the recovery in global demand. However, the overall outlook is susceptible to significant risks, such as the prolonged impact of Russia's invasion of Ukraine on commodity prices, global financing constraints, drought, and a sluggish global economic recovery. To mitigate these risks, potential measures include diversifying exports and market destinations, boosting domestic resource mobilization, implementing comprehensive financial sector reforms, and expediting structural reforms. 2024 CFSP Submitted to County Assembly 18 Figure 2: Annual Real GDP Growth rates. The growth momentum fluctuated in the first three quarters of 2022 averaging 4.5 percent despite subdued performance in agriculture and a general slowdown in manufacturing, retail, and wholesale trade. The economy grew by 4.3 percent in the first quarter and 3.7 percent in the second quarter of 2023 compared to a growth of 9.4 percent and 8.6 percent in similar quarters in 2022. In the third quarter of 2023, the economy grew by 5.3 percent compared to a growth of 6.2 percent in the corresponding quarter of 2022. Most sectors posted slower growth owing to the high inflation rates, falling exchange rates against major currencies and rising oil prices across the globe. The growth in the third quarter of 2023 was mainly supported by growth in Agriculture and the continued resilience of service sectors. The growth was however hampered by declines in the performance of the Industrial sector (manufacturing, electricity, and water). Manufacturing subsector expanded by 2.0 percent in the third quarter of 2023 compared to 3.8 percent growth recorded in the same period of 2022. The growth in the industry was supported by the manufacture of food products that included bakery products and processing and preservation of fish. The activities in the services sector normalized and remained strong in the third quarter of 2023 with a 6.0 percent growth compared to 8.5 percent growth in the third quarter of 2022. This performance is characterized by significant growths in Accommodation and Food Service; Information and Communication Technology; Transportation and Storage; Financial and Insurance; and Wholesale and Retail Trade Sub-Sectors. 2.2.3 External Sector Developments The overall balance of payments position slowed down to a surplus of USD 1321.4 million, about 1.3 percent of GDP, in November 2023 from a surplus of USD 1802.8 million (1.6 percent of GDP) in November 2022. This was mainly due to a decline in the capital account balance by USD 10.8 million to register a surplus of USD 133.7 million compared to a surplus of USD 144.5 million in 2022. Net financial inflows reduced to USD 3030.6 million compared to USD 4329.1 million in November 2022. Most of the net financial inflows was attributed to financial derivatives and 2024 CFSP Submitted to County Assembly 19 direct investments. On the other hand, portfolio investments registered a net outflow over the financial period. The current account deficit improved from USD 6012.3 million (5.4% of GDP) in November 2022 to USD 4196.5 million (4.2% of GDP) in November 2023.The current account balance was supported by an improvement in the trade balance account and resilient remittances. 2.3 National Fiscal Policy Budget execution in the first five months of FY 2023/24 progressed relatively well. Revenues continued to record a growth albeit revenue shortfall reflecting improvement in business environment, tax policy measures and improved revenue administration by the Kenya Revenue Authority. Overall expenditures were below set targets by Ksh. 335.7 billion in November 2023 on account of below target disbursement to key sectors such as recurrent expenditure, which fell short by Ksh. 166.7 billion, Development expenditure which had a reduced disbursement of Ksh. 106.1 billion, County Government’s disbursement also fell short of required amounts by Ksh. 62.8 billion. The below target performance in expenditure in 2023 is mainly attributed to revenue performance shortfalls. Revenue collection until November 2023 exhibited a modestly increased growth rate of 13.2 percent, surpassing the 10.6 percent growth observed in November 2022. This improved performance in revenue is attributed in part to the escalating cost of living, which has adversely impacted the business environment. By the end of November 2023, the cumulative total revenue, inclusive of Ministerial Appropriation in Aid (A-i-A), outlined in the 2024 Budget Policy Statement, reached Ksh 1,011.5 billion. However, this fell short of the target of Ksh 1,110.2 billion, resulting in a deficit of Ksh 98.7 billion. Specifically, ordinary revenue for the period leading up to November 2023 amounted to Ksh 878.9 billion, missing the Ksh 977.1 billion target and reflecting a shortfall of Ksh 98.2 billion, despite experiencing an 11.7 percent growth. Notably, all major tax categories within ordinary revenue, except for Value Added Tax (VAT), failed to meet their respective targets during the review period. Income tax fell short by Ksh 76.6 billion, Excise taxes by Ksh 17.1 billion, and Import duty by Ksh 12.6 billion. On a positive note, Value Added Tax (VAT) and other revenue exceeded their targets by Ksh 2.2 billion and Ksh 12.0 billion, respectively. Ministerial A-i-A, inclusive of the Railway Development Levy, totaled Ksh 132.7 billion in November 2023, falling slightly short of the Ksh 133.2 billion target by Ksh 0.5 billion. The aggregate expenditure and net lending for the period up to November 2023 totaled Ksh 1,160.8 billion, falling short of the target of Ksh 1,496.4 billion by Ksh 335.6 billion. This shortfall in expenditure was primarily attributed to disbursements below the target for recurrent expenditure by Ksh 166.7 billion, development expenditure by Ksh 106.1 billion, and disbursement to County Governments falling short by Ksh 62.8 billion. As of November 2023, the lower-than-target recurrent expenditure was due to subpar payments in various categories, including domestic interest Ksh 51.8 billion, operations and maintenance Ksh 83.7 billion, 2024 CFSP Submitted to County Assembly 20 pensions Ksh 17.0 billion, external interest Ksh 6.2 billion, and contributions to the civil service pension fund Ksh 7.3 billion. Additionally, the shortfall in development expenditures amounted to Ksh 106.1 billion, attributed to below-target disbursements for domestically financed programs Ksh 91.1 billion and foreign-financed programs Ksh 13.1 billion. By the end of November 2023, the fiscal operations of the government yielded an overall deficit, including grants, amounting to Ksh 144.4 billion, notably lower than the anticipated deficit of Ksh 379.7 billion. This deficit was covered through a combination of net domestic borrowing, which amounted to Ksh 156.2 billion, and net foreign repayment of Ksh 23.4 billion. The medium-term fiscal policy approach aims to support the Government's Bottom-Up Economic Transformation Agenda by consistently executing a growth-responsive fiscal consolidation plan. This plan is designed to slow down the annual increase in public debt while implementing an effective liability management strategy that does not compromise public service provision. The Government will also introduce measures to broaden the revenue base and streamline expenditures, leading to a reduction in fiscal deficits. As a result of these reforms, it is anticipated that revenue collections are projected to increase to 20.2 percent of GDP in the fiscal year 2027/28, up from 19.0 percent in the fiscal year 2023/24. Simultaneously, total expenditures are projected to decrease to 23.7 percent of GDP from the current 24.2 percent over the same period. The implementation of these revenue and expenditure reforms is expected to bring about a reduction in the fiscal deficit, including grants, from Ksh 785.0 billion (4.9 percent of GDP) in the fiscal year 2023/24 to Ksh 771.0 billion (3.1 percent of GDP) in the fiscal year 2027/28. 2.4 Economic Outlook The economy is projected to remain strong over the medium term. This is supported by the continued robust growth of the services sectors, the rebound in agriculture, and the ongoing implementation of measures to boost economic activity in priority sectors by the Government. The economy is expected to remain resilient and expand by 5.5 percent in 2024. From the supply side, this growth will be driven by a strong recovery in the agriculture sector supported by the anticipated adequate rainfall in most parts of the country and a decline in global commodity prices that will reduce the cost of production. Additionally, Government intervention measures aimed at lowering the cost of production such as the ongoing fertilizer and seed subsidy program and provision of adequate affordable working capital to farmers will support growth of the sector. On the demand side, growth will be driven by an improvement in aggregate demand. Aggregate demand will be supported by household private consumption and robust private sector investments coupled with Government investments as the public sector consolidates. This growth will also be supported by improvement in the external account supported by strong export growth and resilient remittances. Consumption will mainly be driven by strong Private consumption which is expected to increase to 78.9 percent of GDP in 2024 from 78.1 percent of GDP in 2023. The easing of inflationary pressures will result in strong household disposable income, which will in turn support 2024 CFSP Submitted to County Assembly 21 household consumption. Government consumption is projected to decline in 2023 and 2024 in line with the fiscal consolidation program. Aggregate investment is projected to remain stable at 19.4 percent of GDP in 2023 and 19.5 percent of GDP in 2024 mainly supported by the private sector. Investment will benefit from focus on public-private-partnership (PPP) projects and improvements in the Foreign Exchange market conditions. Interventions by the Government through the Hustlers’ Fund will strengthen MSMEs thereby correcting market failures for the vast majority of Kenyans at the bottom of the pyramid. In the Balance of Payments statement, external financing needs will be met mainly by equity inflows and foreign direct investment given the conducive business climate that the Government has created, particularly the fiscal policy predictability. 2.4.1 Risks to the Economic Outlook The county is home to Kerio Valley and the frequent attack from bandits continues to pose great security risks along the Kerio Valley and its environs. Prolonged rains continue to pose dangers, making the county susceptible to natural disasters including landslides, flooding and drought, these disasters pose a huge risk to life and property. The disasters also threaten food security, utilities, road network and public health. The occurrence of such disasters will require huge financial resources and thus pose fiscal risk to the county government. In terms of management, the wage bill is a major risk to the fiscal outlook in the medium-term. The burden that wage-bill weighs on the budget is heavy and it is expected to continue posing fiscal risk to the County Government. Nationally, there are downside risks emanating from domestic as well as external sources. On the domestic front, risks relate to unpredictable weather conditions due to the impact of climate change which could adversely affect agricultural production and result in domestic inflationary pressures and food insecurity. Tight fiscal space due to the impact of the multiple shocks that have affected the global and the domestic economy might lead to tight liquidity conditions for financing the budget. On the external front, uncertainties in the global economic outlook stemming from the escalating geopolitical fragmentations could result in higher commodity prices which poses a risk to domestic inflation outcomes leading to further tightening of financial conditions. Additionally, weaker global demand due to the slowdown in the global economic recovery could adversely affect Kenya’s exports, foreign direct investments, and remittances. Continued strengthening of the US dollar against other global currencies arising from aggressive monetary policy tightening presents significant risks to financial flows and puts pressures on the exchange rate with implication to growth and inflation. The upside risk to the domestic economy relates to early easing of global financing conditions and lower international fuel and food prices, which would strengthen Kenya’s external balances. The county Government continues to monitor the above risks and will take appropriate policy measures to safeguard the economy against the adverse effects of the risks if they were to materialize. 2024 CFSP Submitted to County Assembly 22 CHAPTER THREE: COUNTY FISCAL POLICY 3.1 Overview In the medium term, the fiscal strategy of Elgeyo Marakwet County Government aims to foster steady economic growth and ensure effective service delivery. This strategic approach is in harmony with the objectives outlined in the nation's Medium-Term Plan IV (MTP IV). To address budgetary requirements, there will be targeted initiatives to broaden the revenue base and achieve the expected growth in revenue collection. The County Government is committed to implementing a sound fiscal policy, concentrating on upholding macroeconomic stability. The principal goal is to establish a framework that not only supports economic activities but also facilitates the fulfillment of responsibilities entrusted to the County Government. All these efforts are carried out within the bounds of a sustainable public finance management system, with an emphasis on responsible financial practices. 3.2 CFSP Alignment to Budget Policy Statement The County Fiscal Strategy Paper (CFSP) of the County Government strategically aligns its priorities and policy objectives with the national Budget Policy Statement (BPS) for 2024. This alignment is influenced by the overarching framework of the Bottom-up Economic Transformation Agenda (BETA) championed by the Kenya Kwanza administration. The BETA is dedicated to fostering economic revitalization and inclusive growth, with an emphasis on increased investments in key sectors expected to significantly impact the overall economy and household well-being. The identified priority sectors include Agricultural Transformation, Micro, Small and Medium Enterprises (MSME), Housing and Settlement, Healthcare, Digital Superhighway, and Creative Industry. The emphasis is on promoting increased employment, ensuring a more equitable distribution of income, strengthening social security measures, expanding the tax revenue base, and enhancing foreign exchange earnings. The successful implementation of these measures is anticipated to stimulate economic recovery, projecting a growth rate of 5.5 percent in 2024, aligning with the 5.5 percent economic growth recorded in 2023. The County Government's fiscal policy stance for the medium term is strategically developed to actively support the Government's Bottom-Up Economic Transformation Agenda. This involves implementing a growth-friendly fiscal consolidation plan aimed at providing economic empowerment opportunities to residents and improving the overall delivery of services to the community. 2024 CFSP Submitted to County Assembly 23 3.3 Fiscal Performance In the medium term, the Government is steadfast in its commitment to a fiscal rationalization approach, striving to maintain an overall fiscal balance as per the parameters outlined in the CFSP 2024. This dedication ensures a balance between recurrent and development expenditures. To achieve these objectives, the Government will persist in streamlining recurrent spending while intensifying efforts in resource mobilization. The county government will address the pressure on the budget caused by the wage bill by rationalizing staff replacements. Notably, these rationalization efforts have led to a reduction in the wage bill from 49 percent in 2023 to 43.4 percent in 2024. To bolster revenue mobilization, the Government has implemented measures to enhance revenue performance and guard against potential revenue shortfalls. These measures encompass: Automated Revenue Collection - Ongoing efforts to automate collection processes, utilizing cashless payments and the Integrated County Revenue Management System (ICRMS), take precedence. This prioritization is aimed at streamlining payment procedures, resulting in increased efficiency and improved collections. Oversight of Cess Payments - Vigorous follow-ups on cess payments from millers and road contractors are actively pursued to ensure compliance and strengthen revenue streams. Enterprise Inventory - Initiating comprehensive inventories of business enterprises in urban areas is underway to ensure that targeted revenue collection is evidence-based and aligned with economic realities. Valuation Roll Review - The county government will conduct a review of the valuation roll to ensure that levies are updated, enhancing the collection of rates. Performance Contracting and Appraisal System - Individual officers are assigned personal targets through a Performance Contracting and Appraisal System, fostering accountability and providing incentives for efficient revenue collection practices. 3.4 Deficit, Debt policy and Debt Sustainability As per the present evaluation, the county currently functions without any public debt. On a national scale, the Public Finance Management Act of 2012 and its associated regulations dictate the necessity for maintaining sustainable levels of public debt. Indicators reflecting the sustainability of external debt highlight that Kenya comfortably adheres to the established thresholds. This advantageous position is primarily credited to a substantial portion of the debt being arranged under concessional terms, characterized by both low costs, and extended maturity periods. 2024 CFSP Submitted to County Assembly 24 3.5 County Economic Performance and Prospects 3.5.1 Growth Prospects and Challenges The county's path towards heightened economic possibilities relies on several growth possibilities which include the following areas. ● Enhanced Agricultural Productivity - Improving agricultural productivity is a crucial element in driving the county towards economic progress. The government is increasing the adoption of cash crops to boost household incomes, aligning with the county's wealth creation policy. ● Urban Expansion - Urban growth often results in heightened economic activity. Growing urban areas typically witness the emergence of new businesses and services, generating job opportunities and contributing to overall economic development. To support urban growth, the county government is implementing urban planning for its major urban centers, aiming to streamline development. The execution of the Iten Urban Economic plan is expected to stimulate urban growth, with positive effects across all sectors, creating a substantial number of both direct and indirect job opportunities. ● Ventures in Value Addition - Investments in ventures that enhance the value of products promise to increase economic gains by refining and diversifying local products. The county government, in collaboration with the national government, will establish the County Industrial and Aggregation Park (CAIP) to improve the value addition of agricultural produce in the county. This, in turn, is anticipated to boost county revenue collections from enterprises. ● Industrial Development - The revival of Fluorspar mining corporation is poised to significantly benefit residents and play a central role in accelerating development, fostering growth, and positively impacting lives in the region and the entire county. Once operational, the county government will receive royalties from fluorspar mining, leading to an increase in its revenues. ● Increased Irrigated Agriculture - Prioritizing and expanding irrigated agriculture is essential for ensuring consistent agricultural yields and lessening reliance on rain-fed farming. To unlock the substantial agricultural potential, the county is initiating strategic investments. These include the construction of smallholder irrigation dams, enhancements to infrastructure such as roads and power supply, and the improvement of marketing channels through cooperatives and farmer organizations. The adoption of climate-smart agriculture programs has the potential to enhance horticultural crop production and, consequently, elevate household incomes. 3.5.2 Risks to Fiscal Outlook in the County The county's fiscal outlook faces a range of challenges that could jeopardize its economic stability and development plans. These challenges include external geopolitical factors and internal issues. The allocation from the National Treasury to county governments remains 2024 CFSP Submitted to County Assembly 25 stagnant, leading to no growth in the equitable share from the national government. This static allocation implies a reduction in funds for county programs, potentially slowing down the county's development agenda. Additionally, below-target Own Source Revenue Collections create unfunded budget plans, adversely impacting service delivery to citizens. The county government grapples with fiscal constraints, particularly in the productive sector, primarily due to the persistent pressure of the wage bill on the county budget. This pressure has been exacerbated by the stagnation of the equitable share of revenue from the national government and subpar performance in local revenue collection. Furthermore, the county is susceptible to natural disasters like landslides, flooding, and drought, posing significant risks to life, property, food security, utilities, road networks, and public health. Dealing with such disasters requires substantial financial resources, presenting a fiscal risk to the county government. Climate change poses further risks, leading to unfavorable weather conditions that could impact agricultural production and result in inflationary pressures. Uncertainties in the global economic outlook due to the escalating geopolitical conflicts has led to high commodities prices in the country which has led to increased tightening of financial conditions. Inflation has generally remained in excess or less of 2.5 percentage points from the Government target range of 5 percent from June 2022 to June 2023. The continued strengthening of the US Dollar against global currencies has presented significant risks to financial flows and increased pressure on the exchange rate with consequences on growth and inflation. 2024 CFSP Submitted to County Assembly 26 CHAPTER FOUR: COUNTY BUDGET FRAMEWORK 4.1 Fiscal Performance of County Governments in FY 2022/23 In FY 2022/23, the County Government had a total budget of Ksh. 6,256,186,220 out of which Ksh. 4,606,532,480 was CRA allocation, Ksh. 246,239,212 own source revenue, Ksh. 218,097,043 conditional grants allocation and Ksh. 1,185,317,485 rolled over funds from FY 2021/22. From the total revenue, Ksh. 3,991,288,162 was allocated to recurrent while Ksh. 2,264,898,059 was allocated to development. The table below presents the overview of fiscal performance of the county during the financial year 2022/2023. Table 1 : Fiscal Outturn in FY 2022/23 REVENUE SOURCE 2022/23 FY Actual Variance % Approved 1st Disbursement Disbursement Supplementary Equitable Share 4,606,532,480 4,606,532,480 - 100 CRF Returns 2021/22 1,185,317,485 1,185,317,485 - 100 Local Revenue 246,239,212 213,564,131 32,675,081 86.73 DANIDA - Universal Healthcare in 8,137,400 4,849,500 3,287,900 59.6 Devolved Units Programme Kenya Urban Support Programme 2,339,915 -2,339,915 Agriculture Sector Development 14,162,596 8,011,716 6,150,880 56.57 Support Project (ASDSP) Kenya Climate Smart Agriculture 85,593,752 80,593,752 5,000,000 94.16 Project (KCSAP) World Bank-Emergency Locusts 75,879,000 74,041,566 1,837,434 97.58 Response World Bank Nutrition International 15,000,000 15,000,000 - 100 Kenya Informal Sector Settlement 8,324,295 8,024,004 300,291 96.39 Program -KISP Financially Locally Led Climate Change 11,000,000 11,000,000 - 100 –FLOCCA Total 6,256,186,220 6,209,274,549 46,911,671 99.25 4.1.1 County Governments’ Own-Source Revenue (OSR) In FY 2022/23, the total Own Source Revenue collected amounted to Ksh 213,564,131 against a target of Ksh 246,239,212. There was a deficit of Ksh. 32,575,081 translating to a 13% shortfall. The under-performance in own source revenue collection is attributed to under collection of 2024 CFSP Submitted to County Assembly 27 public hospitals fees by Ksh. 42,981,184. In addition, there was prolonged drought which led to decline in production of mangoes, potatoes, and other agricultural produce. This in turn reduced the collections in cess by Ksh. 1,796,601. Furthermore, lack of an updated valuation roll led to under collection in property rent by Ksh. 916,511 against a target of Ksh. 1,500,392 Table 2: County Governments’ Own-Source Revenue (OSR) for period July 2022 to June 2023 (FY 2022/2023) Revenue Sources Approved Estimates Actual Ksh (Net) Variance Percent of (Net) Total (%) CESS 12,909,654 11,113,053 1,796,601 86% Land Rate 1,500,392 583,881 916,511 39% Single/Business Permits 10,443,090 16,716,265 (6,373,175) 162% Property Rent 1,730,500 2,245,389 (514,889) 130% Parking Fees 2,749,530 3,336,580 (587,050) 121% Market Fees 2,922,923 6,455,098 (3,532,175) 221% Advertising 1,103,580 1,500,300 (396,720) 136% Hospital Fees 200,000,000 157,018,816 42,981,184 79% Public Health Service Fees 2,013,975 2,488,526 (474,551) 124% Physical Planning and Development 150,550 1,764,000 (1,613,450) 1172% Hire Of County Assets 218,230 - 218,230 0% Conservancy Administration 1,436,927 878,460 558,467 61% Administration Control Fees and 185,000 30,600 154,400 17% Charges Proceeds from sale of assets - - - 0% Park Fees 1,056,923 153,200 903,723 14% Other Fines, Penalties, and 810,000 393,979 416,021 49% Forfeiture Fees Miscellaneous Receipts 7,007,938 8,885,984 (1,878,046) 127% Total Receipts 246,339,212 213,564,131 32,575,081 87% 2024 CFSP Submitted to County Assembly 28 4.1.2 County Governments’ Budget Absorption The total expenditure for the FY 2022/2023 amounted to Ksh 5,116,043,371 against an approved budget of Ksh 6,256,186,221, representing an under spending of Kshs 1,140,142,850. Absorption rate of recurrent budget was high amounting to Kshs 3,729,311,699 against an approved budget of Kshs 3,991,288,162 reflecting an absorption rate of 93.4%. The absorption of the development budget amounted to Ksh 1,386,731,672 against an approved budget Ksh 2,264,898,059, reflecting an absorption rate of 61.23%. The main reasons for under- performance were slow implementation pace by contractors, Elnino rains and insecurity along the Kerio Valley. 2024 CFSP Submitted to County Assembly 29 Table 3: Overall absorption Rates for FY 2022/2023 CODE Department Recurrent Development Total (Recurrent and Balance % On Total Development) Expenditure Approved Actual Approved Actual Total Actual total Budget Expenditure Budget Expenditure Approved Expenditure budget 4361 County Assembly 733,192,337 680,405,779 733,192,337 680,405,779 52,786,558 92.80 4362 Office of the Governor 203,237,177 186,847,384 203,237,177 186,847,384 16,389,793 91.94 4363 Finance and Economic 242,746,177 219,441,752 242,746,177 219,441,752 23,304,425 90.40 Planning 4364 Agriculture and 99,199,387 83,171,807 541,430,254 324,752,464 640,629,641 407,924,271 232,705,370 63.68 Irrigation 4368 Water, Environment 2,305,442 2,249,937 257,592,762 166,197,268 259,898,204 168,447,205 91,450,999 64.81 and Climate Change 4366 Education & Technical 267,934,098 213,949,072 237,627,613 141,502,796 505,561,711 355,451,868 150,109,843 70.31 Training 4367 Health and Sanitation 1,756,342,428 1,701,139,949 452,627,160 141,156,788 2,208,969,588 1,842,296,737 366,672,851 83.40 4365 Lands and Physical 77,059,204 71,131,982 89,077,879 39,652,366 166,137,083 110,784,348 55,352,735 66.68 Planning 4369 Roads, Transport & 122,127,201 118,214,564 553,333,784 504,400,796 675,460,985 622,615,360 52,845,625 92.18 Public Works 4371 Trade, Tourism & 38,552,344 34,878,707 20,124,819 10,808,194 58,677,163 45,686,901 12,990,262 77.86 Industrialization 4372 Youth, Sports, Gender 62,586,817 60,211,668 82,624,640 46,721,539 145,211,457 106,933,207 38,278,250 73.64 and Social Services 4373 ICT & Public Service 245,668,514 241,040,205 27,959,148 9,046,736 273,627,662 250,086,941 23,540,721 91.40 4374 County Public Service 44,980,938 44,603,656 2,500,000 2,492,725 47,480,938 47,096,381 384,557 99.19 Board 4377 Livestock, Fisheries and Co-operative 95,356,098 72,025,237 - 95,356,098 72,025,237 23,330,861 75.53 Development TOTAL 3,991,288,162 3,729,311,699 2,264,898,059 1,386,731,672 6,256,186,221 5,116,043,371 1,140,142,850 81.78 2024 CFSP Submitted to County Assembly 30 FY 2023/2024 FINANCIAL PERFORMANCE The revenue collected in the first half of FY 2023/2024 was Ksh. 124,057,382 against the annual target of Ksh.220,326,633. This translates to 56.3%. The Revenue streams which posted significant performance during the period include Market Fees, Property Rent, Physical Planning and Development, Public Health Fees, Cess and Facility Improvement Funds. This is as shown in the table below. Table 4: Revenue Collection for Period July 2023 to Dec 2024 (F/Y 2023/2024) REVENUE SOURCE APPROVED HALF YEAR HALF YEAR ESTIMATES TARGET ACTUALS 2023/24 Auction/ Animal stock sale fees 3,000,000 1,500,000 575,401 Cesses 14,000,000 7,000,000 8,383,537 Single Business Permit 19,944,405 9,972,203 1,415,015 Lands Rates 2,500,000 1,250,000 315,723 Plot Rent 2,500,000 1,250,000 1,402,630 Bus Park/motorcycle fees 4,000,000 2,000,000 2,230,250 Slaughterhouses fees 1,897,551 948,776 478,990 Hide and skins 52,500 26,250 300 stall/ground - - 168,500 House rent - - 1,229,489 Conservancy fees 2,000,000 1,000,000 47,350 Signboards, Billboards, promotion/advertising 3,000,000 1,500,000 370,600 Hire of stadium/field/Social premises 500,000 250,000 - Public Health Facilities Operation-FIF 147,500,000 73,750,000 98,068,415 Water supply -Metered water charges 1,595,672 797,836 - Public Health Services 2,500,000 1,250,000 667,500 Game and Natural Park fees -Tourism 1,600,000 800,000 310,190 Market fees and others 4,194,250 2,097,125 4,747,124 Administrative Services - - - (i) Building plan Approval Fees (physical planning) 1,500,000 750,000 73,500 (ii) Weights and Scales 229,142 114,571 22,900 (iii) Application Fees 2,000,000 1,000,000 204,900 (iv) clearance fees 200,000 100,000 42,200 Other Fees and Charges - - - (i) Fines and Impounding charges 1,500,000 750,000 172,660 (ii) Tender Documents - - - Receipts not classified anywhere (Specify) - - Others miscellaneous Receipts 4,113,113 2,056,557 - (i) VSD (Meat inspection, movement permits) - 364,330 (ii) Recoveries - 919,880 (iv) Others - 1,845,999 - - TOTALS 220,326,633 110,163,317 124,057,382 2024 CFSP Submitted to County Assembly 31 4.3 FY 2023/2024 ABSORPTION RATES The absorption rates among departments in the county for the first half year of FY 2023/24 are as shown in table 5 and table 6 below. Table 5: Recurrent absorption CODE DEPARTMENT Approved Budget Cumulative Balance Absorption Expenditure. rates R.4361 County Assembly 732,213,522 360,510,985 371,702,537 49.24% R.4362 Governor’s Office 145,279,638 101,556,482 43,723,156 69.90% R.4363 Finance and Economic Planning 198,242,036 109,974,631 88,267,405 55.47% R.4364 Agriculture & Irrigation. 150,216,569 65,139,038 85,077,531 43.36% R.4365 Water, Environment and 54,768,511 24,982,423 29,786,088 45.61% Climate Change R.4366 Education & Technical Training 276,378,471 166,156,373 110,222,098 60.12% R.4367 Health & Sanitation 1,677,654,881 952,040,132 725,614,749 56.75% R.4368 Lands and Physical Planning 51,900,726 34,366,601 17,534,125 66.22% R.4369 Roads, Transport & Public 99,969,154 68,279,018 31,690,136 68.30% Works R.4371 Trade, Tourism & 65,165,191 33,792,708 31,372,483 51.86% Industrialization R.4372 Youth, Sports, and Gender 53,307,152 22,293,558 31,013,594 41.82% R.4373 ICT & Public Service 272,676,827 184,705,760 87,971,067 67.74% R.4374 County Public Service Board 52,046,441 33,086,856 18,959,585 63.57% Sub total 3,829,819,119 2,156,884,565 1,672,934,554 56.32% Table 6: Development Absorption CODE DEPARTMENT Approved Cumulative Balance % on Total Budget Expenditure. Expenditure D.4361 County Assembly - D.4362 Governor & D/Governor’s - - - Office D.4363 Finance and Economic Planning - - - D.4364 Agriculture & Irrigation. 741,297,796 42,812,071 698,485,725 5.78% D.4365 Water, Environment and 442,283,543 37,926,146 404,357,397 8.58% Climate Change D.4366 Education & Technical Training 347,380,548 26,520,165 320,860,383 7.63% D.4367 Health & Sanitation 511,924,396 144,233,258 367,691,138 28.17% D.4368 Lands and Physical Planning 144,734,810 6,095,900 138,638,910 4.21% D.4369 Roads, Transport & Public 577,846,121 11,723,338 566,122,783 2.03% Works 2024 CFSP Submitted to County Assembly 32 D.4371 Trade, Tourism & 382,372,928 2,859,860 379,513,068 0.75% Industrialization D.4372 Youth, Sports, and Gender 127,414,646 4,643,300 122,771,346 3.64% D.4373 Public Service Management 50,065,361 0 50,065,361 0.00% D.4374 County Public Service Board 2,500,000 0 2,500,000 0.00% Sub total 3,327,820,149 276,814,038 3,051,006,111 8.32% During the first half of FY 2023/24, the recurrent and development absorption rates are 56.3 percent and 8.32 percent, respectively. 4.4 FY 2023/2024 EXPENDITURE 4.4.1 RECURRENT EXPENDITURE 4.4.1.1 PERSONAL EMOLUMENTS (PE) EXPENDITURE Table 7: Personnel Emoluments Analysis CODE DEPARTMENT Approved, FY 2023/2024 Estimates FY 2024/2025 R.4361 County Assembly - - R.4362 Office of the Governor 106,806,184 127,179,990 R.4363 Finance and Economic Planning 171,653,623 204,790,629 R.4364 Agriculture and Irrigation 135,614,131 76,355,884 Livestock and Fisheries 65,630,302 R.4365 Water, Environment and Climate Change 36,403,180 41,528,523 R.4366 Education & Technical Training 267,337,764 310,352,925 R.4367 Health Services 1,332,768,320 1,465,597,861 R.4368 Lands, Physical Planning, Housing and Urban Development 35,364,251 45,068,704 R.4369 Roads, Transport & Public Works 87,925,415 108,546,586 R.4371 Cooperatives, Trade, Industrialization, Tourism and Wildlife 55,037,244 64,923,977 R.4372 Sports Youth Affairs, Culture Children and Social Services 38,858,536 42,512,724 R.4373 Administration, Devolution and Enforcement 120,774,111 81,084,724 Public Service and Corporate Affairs 55,533,177 R.4374 County Public Service Board 40,495,702 38,892,153 TOTAL (KSHS) 2,429,038,461 2,727,998,158 2024 CFSP Submitted to County Assembly 33 4.4.1.2 OPERATIONS AND MAINTENANCE Table 8: Operations and Maintenance CODE DEPARTMENT Normal Mandatory O&M Mandatory Conditional TOTAL (C=A+B) O&M (A) Description O&M Grants Allocation (B) R.4361 County 693,567,522 693,567,522 Assembly R.4362 Office of the 27,954,448 Peace Initiatives 2,000,000 30,954,448 Governor County HQs 1,000,000 Electricity Bills R.4363 Finance and 14,569,582 Emergency Fund 2,000,000 66,619,582 Economic Planning Revenue Systems 8,550,000 and commissions and Administration CE Public 4,000,000 participation costs (ADP, Policies) Kenya Devolution 37,500,000 Support Program (KDSP) II R.4364 Agriculture and 5,147,058 5,147,058 Irrigation Livestock and 5,147,058 Abattoir 1,800,000 6,947,057 Fisheries R.4365 Water, 5,804,165 5,804,165 Environment and Climate Change R.4366 Education & 7,124,425 PEPEA Program 2,000,000 9,124,425 Technical Operations Training R.4367 Health Services 10,686,638 FIF 180,000,000 384,566,872 Medical Drugs 150,000,000 User Fees 8,790,000 Primary Health 5,947,500 Care 2024 CFSP Submitted to County Assembly 34 CODE DEPARTMENT Normal Mandatory O&M Mandatory Conditional TOTAL (C=A+B) O&M (A) Description O&M Grants Allocation (B) Community 29,142,734 Health Promoters R.4368 Lands, Physical 6,352,197 Fire Engines 5,576,344 21,928,541 Planning, Operations, Housing and Insurance and Urban Compactor Development maintenance Streetlights and 10,000,000 maintenance billing R.4369 Roads, 9,490,930 9,490,930 Transport & Public Works R.4371 Cooperatives, 5,380,685 Market operations 680,213 7,560,898 Trade, Rimoi Development 1,500,000 Industrialization, Tourism and and Maintenance Wildlife R.4372 Sports Youth 5,081,758 Iten International 8,000,000 17,081,758 Affairs, Culture Marathon Children and Social Services Kenya Inter- 4,000,000 Counties Sports and Cultural Association (KICOSCA) R.4373 Administration, 3,113,822 staff medical cover 140,000,000 146,713,822 Devolution and Ward and sub 3,600,000 Enforcement county administration operations Public Service 3,113,823 Internet cabling and 2,660,695 5,774,518 and Corporate fibre optic Affairs R.4374 County Public 5,033,416 5,033,416 Service Board TOTAL (KSHS) 114,000,003 1,229,724,774 72,590,234 1,416,315,010 2024 CFSP Submitted to County Assembly 35 The total O&M is Ksh 1,416,315,010. This comprises Ksh 114,000,003 as general day-to-day running of departmental operation, Ksh. 1,230,044,561 Mandatory O&M which is composed of the following: County Assembly Ceiling, Emergency fund provision, FIF, Street Lighting Bills, medical drugs, fire engine operations, Staff medical scheme, Iten Marathon, KICOSCA and Public Participation costs among other provisions and conditional grants of Ksh. 72,590,234 comprising Kenya Devolution Support Programme (KDSP) II, Primary Health care and Community Health promoter’s stipend. 4.4.1.3 OVERALL RECURRENT EXPENDITURE ANALYSIS Table 9: summary of Total Recurrent Estimate Allocation CODE DEPARTMENT FY 2024/25 PE FY 2024/25 FY 2024/25 Conditional FY 2024/25 Estimates Mandatory Normal O&M Grants Total Recurrent O&M Estimates Estimates Estimates R.4361 County Assembly 693,567,522 0 0 693,567,522 R.4362 Office of the Governor 127,179,990 3,000,000 27,954,448 0 158,134,438 R.4363 Finance and Economic Planning 204,790,629 14,550,000 14,569,582 37,500,000 271,410,211 R.4364 Agriculture and Irrigation 76,355,884 0 5,147,058 0 81,502,942 Livestock and Fisheries 65,630,302 1,800,000 5,147,057 0 72,577,359 R.4365 Water, Environment and Climate 41,528,523 0 5,804,165 0 47,332,688 Change R.4366 Education & 310,352,925 2,000,000 7,124,425 0 319,477,350 Technical Training R.4367 Health Services 1,465,597,86 338,790,000 10,686,638 35,090,234 1,850,164,733 1 R.4368 Lands, Physical Planning, Housing 45,068,704 15,576,344 6,352,197 0 66,997,245 and Urban Development R.4369 Roads, Transport & Public Works 108,546,586 0 9,490,930 0 118,037,516 R.4371 Cooperatives, Trade, 64,923,977 2,180,213 5,380,685 0 72,484,875 Industrialization, Tourism and Wildlife R.4372 Sports, Youth Affairs, Culture 42,512,724 12,000,000 5,081,758 0 59,594,482 Children and Social Services R.4373 Administration, Devolution & 81,084,724 143,600,000 3,113,822 0 227,798,546 Enforcement Public service and corporate 55,533,177 2,660,695 3,113,823 0 61,307,695 affairs R.4374 County Public Service Board 38,892,153 0 5,033,416 0 43,925,569 2024 CFSP Submitted to County Assembly 36 CODE DEPARTMENT FY 2024/25 PE FY 2024/25 FY 2024/25 Conditional FY 2024/25 Estimates Mandatory Normal O&M Grants Total Recurrent O&M Estimates Estimates Estimates TOTAL (KSHS) 2,727,998,15 1,230,044,56 114,000,004 72,590,234 4,144,313,169 9 1 4.4.2 DEVELOPMENT EXPENDITURE 4.4.2.1 SUMMARY OF DEVELOPMENT ALLOCATIONS FOR FY 2024/25 Table 9: Summary of Development Allocation CODE DEPARTMENT WARD PROJECTS COUNTY LEVEL TOTAL (KSH) (EDA) D. 4361 County Assembly 0 0 0 D.4362 Office of Governor 5,300,000 0 5,300,000 D.4363 Finance and Economic Planning 0 0 0 D.4364 Agriculture and Irrigation 26,845,819 294,101,923 320,947,742 Livestock and Fisheries 52,898,580 40,150,000 93,048,580 D.4365 Water, Environment and Climate Change 212,851,634 212,851,634 D.4366 Education, Science and Technology 204,410,196 204,410,196 D.4367 Health Services 225,488,729 225,488,729 D.4368 Lands, Physical Planning, Housing and Urban 23,712,891 313,419,270 337,132,161 Development D.4369 Roads, Public Works, and Transport 213,280,983 150,644,148 363,925,131 D.4371 Cooperatives, Trade, Industrialization, Tourism and 26,529,493 250,000,000 276,529,493 Wildlife D.4372 Sports Youth Affairs , Culture Children and Social 68,847,890 0 68,847,890 Services D.4373 Administration, Devolution and Enforcement 39,281,064 0 39,281,064 Public Service and Corporate Affairs 0 0 D.4374 County Public Service Board 0 0 0 TOTAL (KSHS) 1,099,447,279 1,048,315,341 2,147,762,620 2024 CFSP Submitted to County Assembly 37 4.4.2.2 ANALYSIS OF DEVELOPMENT PRIORITIES Table 10: Analysis of Development Priorities Code Department APPROVED FY ESTIMATES FY 2023/24 2024/2025 D.4361 County Assembly 0 0 D.4362 Office of Governor 0 5,300,000 D.4363 Finance and Economic Planning 0 0 D.4364 Agriculture and Irrigation 593,410,019 320,947,742 Livestock and Fisheries 93,048,580 D.4365 Water, Environment and Climate Change 534,173,687 212,851,634 D.4366 Education, Science and Technology 173,159,403 204,410,196 D.4367 Health Services 408,098,433 225,488,729 D.4368 Lands, Physical Planning, Housing and Urban Development 128,436,166 337,132,161 D.4369 Roads, Transport and Public Works 257,581,778 363,925,131 D.4371 Cooperatives, Trade, Industrialization, Tourism and Wildlife 369,083,480 276,529,493 D.4372 Sports Youth Affairs, Culture Children and Social Services 59,835,603 68,847,890 D.4373 Administration, Devolution and Enforcement 29,096,981 39,281,064 Public Service and Corporate Affairs 0 0 D.4374 County Public Service Board 0 0 TOTAL 2,552,875,550 2,147,762,620 Note: The 2023/24 FY development figures includes ‘Roll-over funds from 2022/23 FY 4.4.3 2024/25 CFSP OVERALL EXPENDITURE ANALYSIS Table 11: Overall Expenditure Analysis Expenditure Type Budget Allocation Percentage of Estimated Budget (%) Ward (EDA) Development 1,099,447,279 17.47% Development Conditional Grants 1,048,315,341 16.66% Compensation to Employees 2,727,998,158 43.36% Mandatory O&M 1,229,724,774 19.54% Recurrent Conditional Grants 72,590,234 1.15% Utilities and operations 114,000,003 1.81% 2024 CFSP Submitted to County Assembly 38 TOTAL 6,292,075,789 100.00% From the above summary, development allocations are Ksh 1,099,447,279 ward (EDA) and Ksh 1,048,315,341 Conditional grants translating to 17.47% and 16.66% of the total budget respectively indicating 34.13% development allocation of the total budget. The balance makes up the recurrent expenditure totaling Ksh. 4,144,313,169 which is 65.87% of the total budget. 4.5 Resource envelop of the Medium Term Table 12: Resource Envelope REVENUE SOURCE APPROVED APPROVED ESTIMATES PROJECTIONS FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 CRA Share 4,606,532,480 4,801,453,188 4,873,385,244 5,117,054,506 Transfer for Library Services 5,795,078 Conditional Grants 774,096,643 1,120,905,574 1,176,950,853 Nutrition International 10,000,000 Local Revenue 367,100,000 270,326,632 297,784,971 312,674,220 TOTAL REVENUE 4,973,632,480 5,861,671,541 6,292,075,789 4.5.1 Collaboration with National Government and Development Partners Collaboration and partnership between the national government and development partners will be undertaken through existing intergovernmental frameworks such as Intergovernmental Budget & Economic Council (IBEC). Examples of collaborations and partnerships are conditional allocations from Development Partners and national government as per the 2024 Budget Policy Statement (BPS) include IDA (World Bank) Credit (Financing Locally- Led Climate Action (FLLoCA) Program – County Climate Resilience Investment (CCRI) Grant, World Bank - Emergency Locust Response Project (ELRP) , World bank - Kenya Informal Settlement Improvement Project (KISIP II), Kenya Livestock Commercialization Project (KELCOP), Food Systems Resilience Project (FSRP), World Bank-Kenya Devolution Support Program (KDSP) II and DANIDA Grant - Primary Health Care in Devolved Context from development partners. Conditional grants from the national government include Road Maintenance Fund, Leasing of Medical Equipment, transfer for library services and Aggregated Industrial Parks Programme. These conditional allocations are projected by 2024 BPS to be Kshs. 1,120,905,574. 2024 CFSP Submitted to County Assembly 39 4.5.2 Medium-Term Expenditure Estimates Table 13: Medium-Term Expenditure Estimates Department/ Sector Description Approved Approved Estimates Projected Projected Estimates Estimates FY 2022/2023 FY 2023/2024 FY 2024/2025 FY 2025/2026 FY 2026/2027 County Assembly Rec 733,192,337 706,848,845 693,567,522 728,245,898 764,658,193 Dev - - - Office of the Governor Rec 203,237,177 162,511,550 158,134,438 166,041,160 174,343,218 Dev - 5,300,000 5,565,000 5,843,250 Finance & Economic Rec 242,746,177 219,145,884 271,410,211 284,980,722 299,229,758 Planning Dev - - - Agriculture and Rec 99,199,387 156,927,049 81,502,942 85,578,089 89,856,994 Irrigation Dev 541,430,254 593,410,019 320,947,742 336,995,129 353,844,886 Livestock and Fisheries Rec 95,356,098 72,577,359 76,206,227 80,016,538 Dev - 93,048,580 97,701,009 102,586,059 Water, Environment and Rec 2,305,442 56,072,511 47,332,688 49,699,322 52,184,289 Climate Change Dev 257,592,762 534,173,687 212,851,634 223,494,216 234,668,926 Education & Technical Rec 267,934,098 375,248,122 319,477,350 335,451,218 352,223,778 Training Dev 237,627,613 173,159,403 204,410,196 214,630,706 225,362,241 Health Services Rec 1,756,342,428 1,771,655,761 1,850,164,733 1,942,672,970 2,039,806,618 Dev 452,627,160 408,098,433 225,488,729 236,763,165 248,601,324 Lands, Physical Planning, Rec 77,059,204 68,637,885 66,997,245 70,347,107 73,864,463 Housing and Urban Dev 89,077,879 128,436,166 337,132,161 353,988,769 371,688,208 Development Roads, Transport & Rec 122,127,201 186,415,670 118,037,516 123,939,392 130,136,361 Public Works Dev 553,333,784 257,581,778 363,925,131 382,121,388 401,227,457 Cooperatives, Trade, Rec 38,552,344 75,157,946 72,484,875 76,109,119 79,914,575 Industrialization, Dev 20,124,819 369,083,480 276,529,493 290,355,968 304,873,766 Tourism and Wildlife Sports, Youth Affairs, Rec 62,586,817 94,837,553 59,594,482 62,574,206 65,702,916 Culture Children and Social Services Dev 82,624,640 59,835,603 68,847,890 72,290,285 75,904,799 Administration, Rec 245,668,514 315,721,588 227,798,546 239,188,473 251,147,897 Devolution & Dev 27,959,148 29,096,981 39,281,064 41,245,117 43,307,373 Enforcement Rec 61,307,695 64,373,080 67,591,734 2024 CFSP Submitted to County Assembly 40 Department/ Sector Description Approved Approved Estimates Projected Projected Estimates Estimates FY 2022/2023 FY 2023/2024 FY 2024/2025 FY 2025/2026 FY 2026/2027 Public service and Dev corporate affairs County Public Service Rec 44,980,938 52,046,441 43,925,569 46,121,847 48,427,940 Board Dev 2,500,000 - - - TOTAL Rec 3,991,288,162 4,241,226,805 4,144,313,171 4,351,528,830 4,569,105,271 Dev 2,264,898,059 2,552,875,550 2,147,762,620 2,255,150,751 2,367,908,289 GRAND 6,256,186,221 6,794,102,355 6,292,075,791 6,606,679,581 6,937,013,560 TOTAL 2024 CFSP Submitted to County Assembly 41 ANNEXES Annex 1: Recurrent Departmental Ceilings Code Department/ Sector Approved Estimated Ceiling Projection Projection FY 2023/2024 2024/2025 2025/2026 2026/2027 4361 County Assembly 732,213,522 693,567,522 728,245,898 764,658,193 4362 Office of the Governor 145,279,638 158,134,438 166,041,160 174,343,218 4363 Finance & Economic Planning 198,242,036 271,410,211 284,980,722 299,229,758 4364 Agriculture and Irrigation 150,216,569 81,502,942 85,578,089 89,856,994 Livestock and Fisheries 0 72,577,359 76,206,227 80,016,538 4365 Water, Environment and Climate Change 54,768,511 47,332,688 49,699,322 52,184,289 4366 Education and Technical Training 276,378,471 319,477,350 335,451,218 352,223,778 4367 Health Services 1,677,654,881 1,850,164,732 1,942,672,969 2,039,806,617 4368 Lands, Physical Planning, Housing and Urban Development 51,900,726 66,997,245 70,347,107 73,864,463 4369 Roads, Transport, Public Works and Transport 99,969,154 118,037,516 123,939,392 130,136,361 4371 Cooperatives, Trade, Industrialization, Tourism and Wildlife 65,165,191 72,484,875 76,109,119 79,914,575 4372 Sports, Youth Affairs, Culture Children and Social Services 53,307,152 59,594,482 62,574,206 65,702,916 4373 Administration, Devolution and Enforcement 272,676,827 227,798,546 239,188,473 251,147,897 Public service and corporate affairs 0 61,307,694 64,373,079 67,591,733 4374 County Public Service Board 52,046,441 43,925,569 46,121,847 48,427,940 TOTAL 6,256,186,222 4,144,313,169 4,351,528,827 4,569,105,269 2024 CFSP Submitted to County Assembly 42 Annex 2: Development Departmental Ceilings Code Department/ Sector Approved Estimates Projections Projections Ceiling FY 2023/2024 FY 2024/2025 FY 2025/2026 FY 2026/2027 D.4361 County Assembly - - - D.4362 Office of the Governor 5,300,000 5,565,000 5,843,250 D.4363 Finance & Economic Planning - - - D.4364 Agriculture and Irrigation 741,297,796 320,947,742 336,995,129 353,844,886 Livestock and Fisheries 93,048,580 97,701,009 102,586,059 D.4365 Water, Lands, Environment and Climate Change 442,283,543 212,851,634 223,494,216 234,668,926 D.4366 Education and Technical Training 347,380,548 204,410,196 214,630,706 225,362,241 D.4367 Health Services 511,924,396 225,488,729 236,763,165 248,601,324 D.4368 Lands, Physical Planning, Housing and Urban Development 144,734,810 337,132,161 353,988,769 371,688,208 D.4369 Roads, Transport, Public Works, and Transport 577,846,121 363,925,131 382,121,388 401,227,457 D.4371 Cooperatives, Trade, Industrialization, Tourism and Wildlife 382,372,928 276,529,493 290,355,968 304,873,766 D.4372 Sports Youth Affairs, Culture Children and Social Services 127,414,646 68,847,890 72,290,285 75,904,799 D.4373 Administration, Devolution and Enforcement 50,065,361 39,281,064 41,245,117 43,307,373 Public service and corporate affairs - D.4374 County Public Service Board 2,500,000 - - - Total 3,327,820,149 2,147,762,620 2,264,898,059 2,367,908,289 2024 CFSP Submitted to County Assembly 43 Annex 3: Summary (Recurrent and Development) Departmental Ceilings FY 2023/24 2024/25 Projection Department Recurrent Development Total Recurrent Development Total 2025/26 2026/27 County Assembly 732,213,522 732,213,522 693,567,522 - 693,567,522 728,245,898 764,658,193 Office of the Governor 145,279,638 145,279,638 158,134,438 5,300,000 163,434,438 171,606,160 180,186,468 Finance and Economic Planning 198,242,036 198,242,036 271,410,211 - 271,410,211 284,980,722 299,229,758 Agriculture and Irrigation 150,216,569 741,297,796 891,514,365 81,502,942 320,947,742 402,450,684 422,573,218 443,701,879 livestock and Fisheries - 72,577,359 93,048,580 165,625,939 173,907,236 182,602,598 Water, Environment and Climate 54,768,511 442,283,543 497,052,054 47,332,688 212,851,634 260,184,322 273,193,538 286,853,215 Change Education & Technical Training 276,378,471 347,380,548 623,759,019 319,477,350 204,410,196 523,887,546 550,081,923 577,586,019 Health Services 1,677,654,881 511,924,396 2,189,579,277 1,850,164,732 225,488,729 2,075,653,461 2,179,436,134 2,288,407,941 Lands, Physical Planning, Housing 51,900,726 144,734,810 196,635,536 66,997,245 337,132,161 404,129,406 424,335,876 445,552,670 and Urban Development Roads, Transport & Public Works 99,969,154 577,846,121 677,815,275 118,037,516 363,925,131 481,962,647 506,060,779 531,363,818 Cooperatives, Trade, 65,165,191 382,372,928 447,538,119 72,484,875 276,529,493 349,014,368 366,465,086 384,788,341 Industrialization, Tourism and Wildlife Sports Youth Affairs, Culture 53,307,152 127,414,646 180,721,798 59,594,482 68,847,890 128,442,372 134,864,491 141,607,715 Children and Social Services Administration, Devolution and 272,676,827 50,065,361 322,742,188 227,798,546 39,281,064 267,079,610 280,433,591 294,455,270 Enforcement Public service and corporate affairs - 61,307,694 - 61,307,694 64,373,079 67,591,733 County Public Service Board 52,046,441 2,500,000 54,546,441 43,925,569 43,925,569 46,121,847 48,427,940 Total 3,829,819,119 3,327,820,149 7,157,639,268 4,144,313,169 2,147,762,620 6,292,075,789 6,606,679,578 6,937,013,557 2024 CFSP Submitted to County Assembly 44 PART II: EXPLANATORY NOTES A: RESOURCE ENVELOPE FOR 2024/25 FY Table 1: Resource Sources for 2024/25 FY Revenue Source 2023/24 FY 2024/25 FY Increase/ (Proposed) (Ksh.) (Approved) (Ksh.) Decrease (Ksh.) Equitable (CRA) Share Allocation 4,801,882,561 4,873,385,244 71,502,683 As Per the 2024 Budget Policy Sub-total 4,801,882,561 4,873,385,244 71,502,683 Statement (BPS) Local Revenue Non-FIF streams 70,326,632 95,984,971 25,658,339 FIF streams 150,000,000 200,000,000 50,000,000 Appropriations In Aid (AIA) – Abattoirs (Slaughterhouses) 967,350 1,800,000 832,650 Sub-total 221,293,982 297,784,971 76,490,989 Conditional Grants (County Food Systems Resilience Project (FSRP) 0 173,076,923 173,076,923 Governments Additional Allocations Bill, 2024) Emergency Locust Response Project (ELRB 138,144,044 121,025,000 -17,119,044 Kenya Livestock Commercialization Project (KeLCoP) 36,500,000 40,150,000 3,650,000 Kenya Climate Smart Agriculture Project (KCSAP) 90,000,000 0 -90,000,000 Provision of fertilizer subsidy Programme 63,970,782 0 -63,970,782 Agriculture Support Development Support Programme (ASDSP) II 1,042,262 0 -1,042,262 Nutrition International 10,000,000 0 -10,000,000 DANIDA - Primary Health Care 14,617,125 5,947,500 -8,669,625 Community Health Promoters 0 29,142,734 29,142,734 2024 CFSP Submitted to County Assembly 45 Kenya Devolution Support Program (KDSP) II 0 37,500,000 37,500,000 Kenya Urban Support Programme (KUSP) 1,145,356 0 -1,145,356 Kenya Urban Support Programme (KUSP) - UIG 1,194,559 35,000,000 33,805,441 Kenya Informal Settlement Improvement (KISIP II) 50,000,000 278,419,270 228,419,270 Livestock Value Chain Support Project 35,809,200 0 -35,809,200 Road Maintenance Levy Fund (RMLF) 0 150,644,148 150,644,148 Aggregated Industrial Parks Programme (CAIPS) 100,000,000 250,000,000 150,000,000 Financing Locally Led Climate Action (FLLoCA) Program CCRI Grant 212,500,000 0 -212,500,000 Financing Locally Led Climate Action (FLLoCA) Program CCIS Grant 11,000,000 0 -11,000,000 TOTAL 765,923,328 1,120,905,574 354,982,246 Total GRAND TOTAL 5,789,099,871 6,292,075,789 502,975,918 Note 1: There is an increase of Ksh. 71,502,683 in Equitable (CRA) share as provided for in the 2024 Budget Policy Statement (BPS) from the 2023/24 FY allocation. An excerpt of the 2024 BPS showing the exact county allocation has been attached as Annex 1. Note 2: Local Revenue (Own Source Revenue - OSR) is projected to increase by Ksh. 76,490,989. The increase is from three sources: (i) 25,658,339 from non-FIF Streams, (ii) Ksh. 50,000,000 for the Facility Improvement Fund (FIF) and, (iii) Ksh. 832,650 from Appropriations in Aid (AIA) from abattoirs (slaughterhouses). The projected increase in local revenue has been informed by positive trends attributed to enhanced revenue raising strategies as evidenced by the current FY analysis indicated in Annexes 2, 3 & 4 attached. Note 3: Conditional grants sources increased by Ksh. 354,982,246 from Ksh. 765,923,328 in 2023/24 FY to Ksh. 1,120,905,574 in 2024/25 FY as indicated in the County Governments Additional Allocations Bill, 2024 attached as Annex 5. 2024 CFSP Submitted to County Assembly 46 B: ALLOCATION CLASSIFICATIONS AND OVERALL ALLOCATIONS FOR 2024/25 FY The expenditure allocations of CFSPs are classified into two components. Each component has sub-components and Divisions as depicted in Table 2. Table 2: Allocation Classifications Expenditure Sub-Component Divisions Description/Objectives Component Development Ward/EDA Projects - To comply with the Elgeyo Marakwet County Equitable Development Act (EDA) Section 6 (2) & (3) provisions which requires that each Ward be allocated funds based on agreed parameters which includes equal share, population size, land area, poverty level and ASAL coverage Flagship/County - These are development projects whose benefits are not confined to one Ward, but two or more Wards as guided by EDA Level Projects Section 6 (3) (ii). Such projects that facilitate effective and efficient delivery of the county mandates by providing premises and conducive environment. Conditional Grants - These are funds allocated to counties through County Revenue Allocation Act (CARA)/Grants Act/County Governments – Development Additional Allocation Act for specific Development purposes as per the respective Conditional Grants Conditions. Recurrent Personal Existing staff These provisions are based on what each county staff earns in the current FY with the following associated adjustment Emoluments (PE) current salary and items in the 2024/25 FY whose CFSP workings apply; upcoming i) Adjustments for mandatory annual salary increment as per applicable Salaries and Remuneration Commission Financial Year (SRC) circulars. mandatory adjustments ii) Adjustments for emerging new contributory salary components for employers e.g. Housing Levy, Pensions Schemes, NSSF, NITA etc. Existing staff These are provisions budgeted for staff promotions which fall under two categories, promotions iii) Common cadre promotions. These are promotions which are for common establishments as provided by allocation schemes of services for personnel in the County Public Service providing for automatic promotions every three years for every staff still in the common cadre. iv) Non-common cadre promotions made to facilitate succession planning, management and career progression within the County public service. These promotional positions are competitive in nature and are informed by the approved County Staff Establishment and subject to meeting of the set qualifications requirements by staff competing for them. 2024 CFSP Submitted to County Assembly 47 Existing staff Re- v) This provision is to place staff according to their acquired qualifications attained while serving in the county designation public service or having been deployed within the county departments. allocations vi) Facilitate the implementation of the Collective Bargaining Agreement (CBA) signed between County Governments and Kenya Medical Practitioners Pharmacist and Dentist Union (KMPDU) Replacement vii) Allocated amounts to be used to recruit new staff to replace staff who retired, left service, or passed on. positions allocations for staff exits Operations & Mandatory O&M This type of O&M are those allocations that are important and essential for delivering county mandates. The benefits of Maintenance this type of O&M allocations accrue to a wide scope of Wards, Departments, and staff. Examples include medical drugs, (O&M) FIF, staff medical insurance, etc. Normal O&M This type of O&M allocations is for general office operations e.g. electricity bills, fuel, stationery amongst other necessary (Operations and costs to run offices. Utilities) County Assembly CRA recommends the annual County Assemblies budget ceilings, and The Senate approves in the County Revenue Budget Ceilings Allocation Acts (CARAs) Conditional These are recurrent-in-nature funds allocation from Conditional Grants as listed in the County Governments Additional Grants – Allocations Bills/Grant Bills (CGAAB) They are for specific Recurrent purposes as per the Funds conditions contained in the Recurrent CGAAB C: OVERALL ALLOCATIONS FOR 2024/25 FY BASED ON ALLOCATION CLASSIFICATIONS IN No. B ABOVE Table 3: Overall Allocation for 2024/25 FY Expenditure Sub-Component Divisions Amount Allocated Justifications & Reference Documents Component for 2024/25 FY (Ksh.) Developmen Ward/EDA Projects - 1,099,447,279 Approved 2024/25 FY Development (ADP) t County Level Projects - 0 - 2024 CFSP Submitted to County Assembly 48 Conditional Grants – - 1,048,315,341 As per the Conditional Grants list attached in the County Development Governments Additional Allocation Bill (CGAAB) Sub-total - 2,147,762,620 Recurrent Personal Emoluments Existing staff current 2,429,038,46 2,727,998,158 Adjustments for salary Increments as per the SRC Circulars attached (PE) salary adjusted with 1 mandatory increments for 2024/25 FY Existing staff 39,137,757 As per the HR Manuals, schemes of services for career progression promotions allocations within common establishment Common Cadre Existing staff 14,999,994 promotions allocations Non-Common Cadre Existing staff Re- 3,496,920 For career progression, succession management and filling of designation allocations vacant positions as per the approved county staff establishment within the non-common cadre establishment Replacement positions 17,177,172 Provision by County Assembly in the First 2023/24 FY allocations for staff Supplementary budget for recruitment of staff to replace those exits. who have left service through retirement and other natural attritions. ECDE Teachers Salary 22,680,000 This salary increment is to cushion ECDE teachers from the negative Increment effects of inflations. In addition, all the staff have been added salary by SRC, so it is logical to add ECDE teachers at the county level Operations & Mandatory O&M 536,157,252 1,416,315,010 This O&M are important for county mandates delivery whose Maintenance (O&M) benefits of this type of O&M allocations accrue to a wide scope of Wards, Departments, and staff 2024 CFSP Submitted to County Assembly 49 Normal O&M 114,000,003 These allocations enable the county departments to cater for the (Operations & Utilities) day to day running of their departments County Assembly 693,567,522 Set by Senate from the recommendations by CRA Budget Ceilings Conditional Grants – 72,590,234 As per the Conditional Grants list attached in the County Recurrent Governments Additional Allocation Bill (CGAAB) Sub-total - 4,144,313,169 GRAND TOTAL 6,292,075,789 Note 4: Development allocation is 34% of total budget including Conditional Grants. Note 5: Recurrent allocation is 66% of which 43.5% is allocation for PE and 22.5% for O&M (11.5% for County Executive and 11% for County Assembly) Table 4: 2023/24 FY Development Allocation Summary Code Department Development – Ward Development – Conditional Grants – Total Development Allocation (Ksh.) Flagship/County Level Development (Ksh.) (Ksh.) Projects (Ksh.) 4361 County Assembly 0 0 4362 Office of the Governor 5,300,000 0 5,300,000 4363 Finance and Economic Planning 0 0 0 4364 Agriculture and Irrigation 26,845,819 0 294,101,923 320,947,742 Livestock and Fisheries 52,898,580 40,150,000 93,048,580 4365 Water, Environment and Climate Change 212,851,634 0 212,851,634 4366 Education & Technical Training 204,410,196 0 204,410,196 4367 Health Services 225,488,729 0 225,488,729 4368 Lands, Physical Planning, Housing and Urban Development 23,712,891 0 313,419,270 337,132,161 4369 Roads, Transport & Public Works 213,280,983 0 150,644,148 363,925,131 2024 CFSP Submitted to County Assembly 50 4371 Cooperatives, Trade, Industrialization, Tourism and Wildlife 26,529,493 0 250,000,000 276,529,493 4372 Sports Youth Affairs, Culture Children and Social Services 68,847,890 0 68,847,890 4373 Administration, Devolution & Enforcement 39,281,064 0 39,281,064 Public service and corporate affairs 0 4374 County Public Service Board 0 0 0 Total 1,099,447,279 0 1,048,315,341 2,147,762,620 Note 7: There are no funds proposed for allocation to Flagship/County Level Projects because the Ksh. 170,000,000 allocated in 2023/24 FY has been allocated to PE to address the sharp increase in PE for FY 2024/25. Table 5: Conditional Grants - Development for 2024/25 FY Department Conditional Grant Allocation (Ksh.) Agriculture, Livestock, Fisheries, and Irrigation Food Systems Resilience Project (FSRP) 173,076,923 Agriculture, Livestock, Fisheries, and Irrigation Emergency Locust Response Project (ELRB 121,025,000 Agriculture, Livestock, Fisheries, and Irrigation Kenya Livestock Commercialization Project (KeLCoP) 40,150,000 Lands, Physical Planning, Housing & Urban Development Kenya Urban Support Programme (KUSP) - UIG 35,000,000 Lands, Physical Planning, Housing & Urban Development Kenya Informal Settlement Improvement (KISIP II) 278,419,270 Roads, Transport and Public Works Road Maintenance Levy Fund (RMLF) 150,644,148 Cooperatives, Trade, Industrialization, Tourism & Wildlife Aggregated Industrial Parks Programme (CAIPS) 250,000,000 TOTAL 1,048,315,341 Table 6: Recurrent Allocation Summary for 2024/25 FY DEPARTMENT PERSONAL MANDATORY NORMAL O&M COUNTY CONDITIONAL TOTAL EMOLUMENTS (PE) O&M (Ksh.) (Ksh.) ASSEMBLY GRANTS - RECURRENT (Ksh.) CEILINGS RECURRENT (Ksh.) (Ksh.) (Ksh.) County Assembly 0 0 0 693,567,522 0 693,567,522 Office of the Governor 127,179,990 3,000,000 27,954,448 0 0 158,134,438 Finance and Economic Planning 204,790,629 14,550,000 14,569,582 0 37,500,000 271,410,211 Agriculture and Irrigation 76,355,884 0 5,147,058 0 0 81,502,942 Livestock and Fisheries 65,630,302 1,800,000 5,147,057 0 0 72,577,359 2024 CFSP Submitted to County Assembly 51 Water, Environment and Climate Change 41,528,523 0 5,804,165 0 0 47,332,688 Education & Technical Training 310,352,925 2,000,000 7,124,425 0 0 319,477,350 Health Services 1,465,597,861 338,790,000 10,686,638 0 35,090,234 1,850,164,732 Lands, Physical Planning, Housing and Urban Development 45,068,704 15,576,344 6,352,197 0 0 66,997,245 Roads, Transport & Public Works 108,546,586 0 9,490,930 0 0 118,037,516 Cooperatives, Trade, Industrialization, Tourism and Wildlife 64,923,977 2,180,213 5,380,685 0 0 72,484,875 Sports Youth Affairs, Culture Children and Social Services 42,512,724 12,000,000 5,081,758 0 0 59,594,482 Administration, Devolution & Enforcement 81,084,724 143,600,000 3,113,822 0 0 227,798,546 Public service and corporate affairs 55,533,177 2,660,695 3,113,823 0 0 61,307,694 County Public Service Board 38,892,153 0 5,033,416 0 0 43,925,569 Total 2,727,998,158 536,157,252 114,000,003 693,567,522 72,590,234 4,144,313,169 Table 7: PE Comparison between Approved FY 2023/24 and Proposed FY 2024/25 Allocations. Code Department Approved PE 23/24 (Ksh.) TOTAL PE 24/25 (Ksh.) INCREASE (Ksh.) 4362 Office of the Governor 106,806,184 127,179,990 20,373,806 4363 Finance and Economic Planning 171,653,623 204,790,629 33,137,006 4364 Agriculture and Irrigation 135,614,131 76,355,884 -59,258,247 4377 Livestock and Fisheries 65,630,302 65,630,302 4365 Water, Environment and Climate Change 36,403,180 41,528,523 5,125,343 4366 Education & Technical Training 267,337,764 310,352,925 43,015,161 4367 Health Services 1,332,768,320 1,465,597,861 132,829,541 4368 Lands, Physical Planning, Housing and Urban Development 35,364,251 45,068,704 9,704,453 4369 Roads, Transport & Public Works 87,925,415 108,546,586 20,621,171 4371 Cooperatives, Trade, Industrialization, Tourism and Wildlife 55,037,244 64,923,977 9,886,733 4372 Sports Youth Affairs, Culture Children and Social Services 38,858,536 42,512,724 3,654,188 4373 Administration, Devolution & Enforcement 120,774,111 81,084,724 -39,689,387 Public service and corporate affairs 55,533,177 55,533,177 4374 County Public Service Board 40,495,702 38,892,153 -1,603,549 TOTAL 2,429,038,461 2,727,998,158 298,959,697 Table 8: Breakdown of PE increase of Ksh. 298,959,697 in 2024/25 FY from 2023/24 FY 2024 CFSP Submitted to County Assembly 52 Department SRC Salary New Positions Common Non- Redesignat ECDE Housing NSSF 24/25 NITA Total PE Increments Cadre Common ions (Ksh.) Teachers Levy 24/25 (Ksh.) 24/25 Increase (Ksh.) adjustments Promotions Cadre Salary (Ksh.) (Ksh.) for 2024/25 Allocation N 2024 (Ksh.) Promotions Increment FY (Ksh.) (Ksh.) o (Ksh.) (Ksh.) . Office of the Governor 17,161,190 188,100 585,624 - 1,564,259 833,832 40,800 20,373,806 Finance and Economic Planning 27,582,862 167,691 327,953 785,779 - 2,532,841 1,612,080 127,800 33,137,006 Agriculture and Irrigation (64,991,489) 3,367,422 6 242,276 364,221 15,712 - 1,043,292 659,520 40,800 - 59,258,247 Livestock and Fisheries 60,488,839 2,731,921 5 299,282 449,919 - 889,941 727,200 43,200 65,630,302 Water, Environment and Climate (985,777) 5,146,900 8 - 181,203 58,200 0 471,857 236,160 16,800 5,125,343 Change Education & Technical Training 11,042,268 2,410,304 4 801,000 228,388 64,923 22,680,000 4,087,638 1,088,640 612,000 43,015,161 Health Services 54,649,078 36,392,145 11,316,772 1,796,920 - 20,148,026 8,017,200 509,400 132,829,541 Lands, Physical Planning, Housing and 7,632,899 1,146,749 2 114,987 172,283 - - 360,696 264,240 12,600 9,704,453 Urban Development Roads, Transport & Public Works 16,893,389 612,450 526,100 28,485 - 1,408,759 1,079,988 72,000 20,621,171 Cooperatives, Trade, Industrialization, 5,492,896 2,373,877 3 295,265 319,787 - 840,189 529,920 34,800 9,886,733 Tourism and Wildlife Sports Youth Affairs, Culture Children 1,869,765 227,667 374,962 305,479 - 541,995 313,920 20,400 3,654,188 and Social Services Administration, Devolution & (41,881,318) - - 92,160 139,041 121,635 - 1,057,175 745,920 36,000 - 39,689,387 Enforcement Public service and corporate affairs 54,311,218 - - - 729,479 463,680 28,800 55,533,177 County Public Service Board (2,368,722) 38,263 - 525,791 191,520 9,600 - 1,603,549 TOTAL 146,897,097 17,177,172 2 39,137,757 14,999,994 3,496,920 22,680,000 36,201,937 16,763,820 1,605,000 298,959,697 8 Note 8: The increase in PE of Ksh. 298,959,697 in FY 2024/25 from FY 2023/24 has been caused by nine items, namely, i. SRC salary increments for all staff amounting to Ksh. 146,897,097. Beginning July 2024, there will be upward reviews of staff basic salary, commuter, and house allowances. These increases are automatically updated in the IPPD Payroll by the State Department of Public Service Directorate of Personnel Management (DPM). SRC Circulars containing the salary increases are attached as Annexes 6 & 7. ii. Allocation for recruitment of new staff as replacement of staff who have exited service. These positions are 28 with an allocation of Ksh.17,177,172. 2024 CFSP Submitted to County Assembly 53 iii. Allocation of Ksh. 39,137,757 for Common Cadre staff promotions. These are promotions which are automatic every three years for every staff still in the common cadre category. These promotions were not done in 2023/24 FY so there are backlogs which have led to issuance of strike notices by the Unions of the affected staff. To evade labour unrest and industrial strikes and their effects on service delivery this allocation is inevitable. A sample of Strike Notice issued by Kenya Medical Practitioners and Dentist Union (KMPDU) one of the county staff Notices are attached as Annex 8. iv. Allocation of Ksh. 14,999,994 for non-common cadre staff promotions to ensure succession planning is sustainable and improve terms for staff who have acquired additional qualifications and necessary to evade the KMPDU strike notice issued as part of the implementation framework for the CBA signed between county governments and KMPDU in 2017. v. An allocation of Ksh. 3,496,920 for staff redesignations. This provision is to place staff according to their qualifications and current job deployments. This was also part of the conditions for the implementation of the signed CBA between County Governments and KMPDU for doctors returning from studies and training. vi. Allocation of Ksh. 22,680,000 as ECDE teachers’ salary increment as a step towards better terms in the future. This allocation is for a salary increment of 945 ECDE each getting an increment of Ksh. 4,000 monthly from January 2025 (6 months of 2024/25 FY). vii. Allocation of Ksh. 36,201,937 as our County Government’s employer contribution of 1.5% of each staff gross salary as per the Affordable Housing Program. Kindly note that at staff level each of them is deducted 1.5% of his/her gross salary for the Affordable Housing Program. These deductions are done automatically from the payroll (IPPD). IPPD is updated remotely by the State Department of Public Service Directorate of Personnel Management (DPM) whenever such deductions are made. Reference can be made from ‘Affordable Housing Bill 2023 whose implementation has already been affected. An excerpt of the Bill is attached as Annex 9. viii. The NSSF Act compelling employers to pay employer contributions for NSSF came into effect in February 2024. For the County Executive staff this legal provision translates to Ksh. 16,763,820 for the FY 2024/25 all staff calculated as per the formula provided for in the based on each staff Job Group. An excerpt of the NSSF act is attached as Annex 10. ix. Allocation of Ksh. 1,605,000 for National Industrial and Training Authority (NITA) for continuous staff training provided in Section 5 Cap 237 of the Industrial Training Act compelling employers to pay levy to NITA at a monthly rate of 50 shillings per employee. An excerpt of the NITA Act is attached as Annex 11. Table 9: Where increased PE of Ksh. 298,959,697 was sourced from. Source Amount (Ksh.) used to address PE increase Equitable (CRA) Share 66,502,683 of the total CRA Share increase of 71,502,683 2024 CFSP Submitted to County Assembly 54 Flagship/County Level Projects reduction 170,000,000 (this amount was part of the 250,000,000 flagships allocation for Industrial Park in 2023/24 FY. Wards had contributed the other 80,000,000) County Executive Normal O&M Reduction 33,403,578 Local Revenue (Non-FIF streams) increase 10,664,642 PE to be relieved by staff exiting in 2023/24 FY 18,388,798 TOTAL 298,959,697 Note 9: The remainder of 5,000,000 from the increase in Equitable (CRA) share was allocated to County Assembly ceilings. Table 10: Summary numbers of used to compute 2024/25 FY PE DEPARTMENT Existing staff Existing staff New ECDE Casuals Casuals Security TOTAL (IPPD) (Manual) Positions Teachers (Conservancy) (Other) (OOG) Office of the Governor 48 5 0 0 0 13 25 91 Finance and Economic Planning 184 0 0 0 0 29 0 213 Agriculture and Irrigation 62 0 6 0 0 0 0 68 Livestock and Fisheries 63 2 5 0 0 3 73 Water, Environment and Climate Change 26 0 8 0 0 2 0 36 Management Education & Technical Training 70 1 4 945 0 0 1,020 Health Services 814 26 0 0 10 0 850 Lands, Physical Planning, Housing & Urban 21 0 2 0 85 0 0 108 Development Roads, Transport & Public Works 103 0 0 0 0 8 0 111 Cooperatives, Trade and Enterprise 52 0 3 0 0 3 0 58 Development, Tourism development Sports, youth Affairs, Culture, Children and 25 0 0 0 0 9 0 34 Social Services Administration, Devolution & Enforcement 60 0 0 0 0 0 60 Public service and Corporate affairs 47 1 0 0 0 0 0 48 County Public Service Board 16 0 0 0 0 0 0 16 Totals 1,591 35 28 945 85 77 25 2,786 2024 CFSP Submitted to County Assembly 55 Note 10: Conservancy Casuals are those casuals paid on daily wages to manage and maintain cleanliness in urban areas Note 11: Other casuals are those casuals who have been serving since 2015 but whose terms are still not determined Note 12: Security staff are staff seconded by the National Police Service to guard state officers and key official premises. This facilitative allowance treated as PE allocations for these security staff are to cater for stipulated allowances and stipends. Note 13: New Positions are for recruitment of new staff to fill vacancies left by staff who left service in the current and previous Financial Years Note 14: List by names of all staff and positions in Table 10 and respective allocations adding to the total PE figure of Ksh. 2,727,998,158 is attached as Annex 12 for reference. Table 11: Specific Cadres of New (Replacement) Positions Department Position Job Group No. of Positions Agriculture & Irrigation Agricultural Assistant III H 4 Agricultural Assistant II G 2 Livestock & Fisheries Assistant Livestock Production III H 2 Livestock Production Assistant II G 3 Water, Environment and Climate Change Environmental Management Officer II J 4 Forester III H 4 Lands, Physical Planning, Housing and Urban Development Fire Officer J 1 Fireman F 1 Cooperatives, Trade, Industrialization, Tourism and Wildlife Cooperatives Officer II J 2 Tourism Officer K 1 Education & Technical Training Youth Polytechnic Instructor [3] H 4 Total 28 Note 15: The choice of cadres to be replaced are based on an analysis of priority cadres required by our County Government to deliver on the desired development objectives as per the CIDP staffing gaps in departments 2024 CFSP Submitted to County Assembly 56 Table 12: Operations & Maintenance (O&M) Summary for 2024/25 FY DEPARTMENT MANDATORY NORMAL O&M COUNTY CONDITIONAL TOTAL O&M O&M (Ksh.) (Ksh.) ASSEMBLY GRANTS REC (Ksh.) CEILINGS (Ksh.) (Ksh.) County Assembly 0 0 693,567,522 0 693,567,522 Office of the Governor 3,000,000 27,954,448 0 0 30,954,448 Finance and Economic Planning 14,550,000 14,569,582 37,500,000 66,619,582 Agriculture and Irrigation 0 5,147,058 5,147,058 Livestock and Fisheries 1,800,000 5,147,057 6,947,057 Water, Environment and Climate Change 0 5,804,165 5,804,165 Education & Technical Training 2,000,000 7,124,425 9,124,425 Health Services 338,790,000 10,686,638 35,090,234 384,566,872 Lands, Physical Planning, Housing and Urban Development 15,576,344 6,352,197 0 21,928,541 Roads, Transport & Public Works 0 9,490,930 9,490,930 Cooperatives, Trade, Industrialization, Tourism and Wildlife 2,180,213 5,380,685 7,560,898 Sports Youth Affairs, Culture Children and Social Services 12,000,000 5,081,758 17,081,758 Administration, Devolution & Enforcement 143,600,000 3,113,822 146,713,822 Public service and Corporate affairs 2,660,695 3,113,823 5,774,518 County Public Service Board 0 5,033,416 5,033,416 Total 536,157,252 114,000,003 693,567,522 72,590,234 1,416,315,010 2024 CFSP Submitted to County Assembly 57 Table 13: Mandatory O&M List of Items Department Item Projected 2024-25 (Ksh.) County Assembly County Assembly Ceiling 693,567,522 Sub Totals 693,567,522 Livestock and Fisheries Abattoirs AIA 1,800,000 Sub Totals 1,800,000 Education and Technical Training PEPEA Operations 2,000,000 Sub Totals 2,000,000 Finance and Economic Planning Emergency fund 2,000,000 CE Public participation costs (ADP, Policies) 4,000,000 Revenue Systems and commissions and Administration 8,550,000 Sub Totals 14,550,000 Health Services Medical Drugs 130,000,000 User Fees for Health Facilities 8,790,000 Facility Improvement Financing (FIF) 180,000,000 Medical Drugs- FIF 20,000,000 Sub Totals 338,790,000 Lands, Physical Planning, Housing and Urban Development Street Lighting Bills 10,000,000 Fire Engines Operations, Insurance and Compactor maintenance 5,576,344 Sub Totals 15,576,344 Office of the Governor County HQs Electricity Bills 1,000,000 Peace Initiatives 2,000,000 Sub Totals 3,000,000 Administration, Devolution and Enforcement CE Staff Medical Cover 140,000,000 Sub county/Ward Offices running costs 3,600,000 Sub Totals 143,600,000 Public Service and Corporate Affairs Internet cabling and fibre optic 2,660,695 Sub Totals 2,660,695 Sports Youth Affairs, Culture Children and Social Services Iten Marathon 8,000,000 2024 CFSP Submitted to County Assembly 58 KICOSCA 4,000,000 Sub Totals 12,000,000 Cooperatives, Trade, Industrialization, Tourism and Wildlife Market operations 680,213 Rimoi Improvements 1,500,000 Sub Totals 2,180,213 Grand Totals 1,229,724,774 Note 16: County Assembly budget ceiling has been estimated to increase by 5,000,000. The final ceiling level will be approved in the County Allocation Revenue Act (CARA) of The Senate adjusted accordingly at the Budget Estimates approval stage. Table 14: Conditional Grants- Recurrent Department Item Projected 2024-25 (Ksh.) Finance and Economic Planning Kenya Devolution Support Program (KDSP) II 37,500,000 Health Services DANIDA – Primary Health 5,947,500 Community Health Promoters 29,142734 Totals 72,590,234 Note 17: Work Plans for the Conditional Grants will be submitted to relevant County Assembly Committees once they are approved by the respective donors. Table 15: Normal O&M (Operations and Utilities) Items Code DEPARTMENT NORMAL O&M 2023/24 FY NORMAL O&M 2024/25 FY Reduction (Ksh.) (Ksh.) (Ksh.) 4362 Office of the Governor 35,473,454 27,954,448 -7,519,006 4363 Finance and Economic Planning 18,488,413 14,569,582 -3,918,831 4364 Agriculture and Irrigation 13,640,088 5,147,058 -8,493,031 Livestock and Fisheries 0 5,147,057 5,147,057 4365 Water, Environment and Climate Change 7,365,331 5,804,165 -1,561,166 4366 Education & Technical Training 9,040,707 7,124,425 -1,916,282 4367 Health Services 13,561,061 10,686,638 -2,874,423 2024 CFSP Submitted to County Assembly 59 4368 Lands, Physical Planning, Housing and Urban Development 8,060,770 6,352,197 -1,708,573 4369 Roads, Transport & Public Works 12,043,739 9,490,930 -2,552,809 4371 Cooperatives, Trade, Industrialization, Tourism and Wildlife 6,827,947 5,380,685 -1,447,262 4372 Sports Youth Affairs, Culture Children and Social Services 6,448,616 5,081,758 -1,366,858 4373 Administration, Devolution & Enforcement 7,902,716 3,113,822 -4,788,894 Public service and corporate affairs 0 3,113,823 3,113,823 4374 County Public Service Board 8,550,739 5,033,416 -3,517,323 Totals 147,403,581 114,000,003 -33,403,578 Note 18: These are O&M items listed in the IFMIS print-out which does not fall under mandatory or essential O&M Note 19: The indicated Normal O&M of Ksh. 114,000,003 is less than the amount allocated for the same purposes in FY 2023/24 by Ksh. 33,403,578 because of the limited fiscal space given the other priority considerations including the huge PE increase detailed in the above sections 2024 CFSP Submitted to County Assembly 60 Table 16: Overall Allocation for FY 2024/25 DEPARTMENT DEVELOPMENT RECURRENT GRAND TOTAL (Ksh.) DEVELOPMENT DEVELOPMENT CONDITIONAL TOTAL DEV PE (Ksh.) MANDATORY NORMAL County CONDITIONAL TOTAL REC WARD (Ksh.) FLAGSHIP (Ksh.) GRANTS DEV (Ksh.) O&M (Ksh.) O&M (Ksh.) Assembly GRANTS REC (Ksh.) (Ksh.) Ceilings (Ksh.) (Ksh.) County Assembly 0 0 0 0 0 693,567,522 0 693,567,522 693,567,522 Office of the Governor 5,300,000 0 0 5,300,000 127,179,990 3,000,000 27,954,448 0 0 158,134,438 163,434,438 Finance and Economic 0 0 0 0 204,790,629 14,550,000 14,569,582 0 37,500,000 271,410,211 271,410,211 Planning Agriculture and Irrigation 26,845,819 0 294,101,923 320,947,742 76,355,884 0 5,147,058 0 0 81,502,942 402,450,684 Livestock and Fisheries 52,898,580 40,150,000 93,048,580 65,630,302 1,800,000 5,147,057 0 0 72,577,359 165,625,939 Water, Environment and 212,851,634 0 212,851,634 41,528,523 0 5,804,165 0 0 47,332,688 260,184,322 Climate Change Education & Technical 204,410,196 0 204,410,196 310,352,925 2,000,000 7,124,425 0 0 319,477,350 523,887,546 Training Health Services 225,488,729 0 225,488,729 1,465,597,86 338,790,000 10,686,638 0 35,090,234 1,850,164,73 2,075,653,46 1 2 1 Lands, Physical Planning, 23,712,891 0 313,419,270 337,132,161 45,068,704 15,576,344 6,352,197 0 0 66,997,245 404,129,406 Housing and Urban Development Roads, Transport & Public 213,280,983 0 150,644,148 363,925,131 108,546,586 0 9,490,930 0 0 118,037,516 481,962,647 Works Cooperatives, Trade, 26,529,493 0 250,000,000 276,529,493 64,923,977 2,180,213 5,380,685 0 0 72,484,875 349,014,368 Industrialization, Tourism and Wildlife Sports Youth Affairs, Culture 68,847,890 0 0 68,847,890 42,512,724 12,000,000 5,081,758 0 0 59,594,482 128,442,372 Children and Social Services Administration, Devolution 39,281,064 0 0 39,281,064 81,084,724 143,600,000 3,113,822 0 0 227,798,546 267,079,610 & Enforcement Public service and Corporate 0 0 0 0 55,533,177 2,660,695 3,113,823 0 0 61,307,694 61,307,694 affairs County Public Service Board 0 0 0 38,892,153 0 5,033,416 0 0 43,925,569 43,925,569 Totals 1,099,447,279 0 1,048,315,341 2,147,762,62 2,727,998,15 536,157,252 114,000,003 693,567,522 72,590,234 4,144,313,16 6,292,075,78 0 8 9 9 2024 CFSP Submitted to County Assembly 61 Table 17: Where the additional Equitable (CRA) share and Local Revenue were allocated to. Revenue Source Increase (Ksh.) Where the additional funds went Equitable (CRA) Share 71,502,683 5,000,000 allocated to County Assembly as addition to budget ceiling 66,502,683 went into addressing the sharp increase in County Executive PE as detailed in Note 8 above. Local Revenue (Non-FIF streams) 25,658,339 10,664,642 went into addressing the sharp increase in County Executive PE as detailed in Note 8 above. 14,993,697 was allocated to mandatory O&M costs including operationalization of fire engines, street lighting, revenue administration costs etc. Table 18: 2024 CFSP Preparation Activity Timelines No. ACTIVITY RESPONSIBILITY TIMELINE VENUE 1. Obtaining of relevant reference documents: Director Economic Planning and 15th – 19th Jan 2024 - Budgeting a) Draft Budget Policy Statement (BPS) b) January 2024 Payroll c) Latest SRC Circulars d) Relevant Cabinet/CHRAC Minutes e) Letters of staff transfers from one department to another 2. Personal Emoluments (PE) and O&M analysis exercise for each Department Respective COs & CPSB Secretary 22nd – 26th Jan CECMs/COs’/ CPSB Offices 3. 1st joint Meeting for all CECMs, COs and CPSB for strategic resolutions County Secretary & CECM FEP 30th Jan ICRH Hall regarding 2024/25 FY allocations 4. County Human Resource Advisory Committee (CHRAC) Meeting for staff PE County Secretary 5th Feb ICRH Hall related discussions i.e replacements, promotions etc 5. Obtain Final BPS Submitted by National Treasury for the Final BPS submitted CEC FEP 14th Feb - to Parliament 2024 CFSP Submitted to County Assembly 62 6. 2nd joint meeting for CECMs, CPSB members, COs, and Directors for Zero draft County Secretary & CECM FEP 19th Feb ICRH Hall presentation 7. Public Participation Forum for 2024 CFSP CEC FEP 22nd Feb Iten MTC Hall 8. Cabinet Meeting for approval CECM FEP 26th Feb Governor’s boardroom 9. Submission to County Assembly CECM FEP 28TH Feb Note 20: Relevant Memos for indicated meetings and adverts in Table 18 are attached as Annex 13 2024 CFSP Submitted to County Assembly 63