Red flag raised over Nairobi county revenue collection system failure, shortfalls in amounts generated
Red flags have been raised over intermittent system failure of the Nairobi Revenue Services (NRS), a Nairobi county revenue collection system amid worrying shortfalls over amounts of revenue collected cumulatively from the various revenue streams.
Fears are also rife over suspected tampering with the revenue collection system and possible embezzlement of funds by occasioning revenue leakage through unaccounted and unrecorded levies generated from taxpayers.
Already, the Ethics and Anti-Corruption Commission (Eacc) has flagged Nairobi currently under the Johnson Sakaja’s leadership as one of the counties with integrity issues in revenue collection and management.
Consequently, Members of the Nairobi County Assembly (MCAs) have approved creation of an ad-hoc committee to probe how revenue is collected and allocated governor Sakaja’s administration.
There has been mounting concerns among perturbed MCAs regarding the diminishing revenue of the Nairobi county government. Creation of the ad-hoc committee sailed through following approval of a motion tabled on the floor of the House by Majority Leader Peter Imwatok.
The motion provides for the formation of an emergency committee comprising of 13 MCAs to delve into the intricacies of the revenue collection system.
“The committee will represent both majority and minority factions in parliament.” Imwatoka affirmed.
The MCAs have now called for a comprehensive investigation to uncover the reasons behind this decline of revenue collection.
Imwatok noted that despite Nairobi County having multiple revenue sources, there has been a consistent underperformance in annual revenue collection compared to annual expenditures.
Recently, Sakaja defended his administration amid financial impropriety fears citing use of the NRS revenue collection website.
In response to these concerns, the Nairobi county government clarified that the NRS website is fully compliant with the law governing the relationship between different levels of government.
“Nairobi County Government and the Kenya Revenue Authority (KRA) reached an agreement on November 15, 2021, to use NRS for improved service delivery and revenue collection.” A quick dispatch to newsrooms read in part.
Since 2013, Nairobi has consistently fallen short of its revenue targets, posing challenges to the city’s fiscal health. Notable disparities between revenue projections and actual collections have raised concerns.
For instance, in the fiscal year 2017-18, the city managed to collect just Sh10.17 billion, considerably below the target of Sh17.23 billion. In the preceding year (2016-17), City Hall aimed to generate Sh19.57 billion but only managed to secure Sh10.93 billion.
The highest revenue collection over this period occurred in 2015-16, amounting to Sh11.71 billion. However, even this achievement remained well below the Sh15.3 billion target, highlighting the persistent gap between revenue aspirations and realised income.
MCAs have queried Nairobi county government’s revenue collection systems, demanding a probe into why City Hall continues to underperform.
