Technology has been cited as one of the solutions counties can use to improve service delivery and grow their Own Source Revenue (OSR).
On the day that the Finance Bill 2024 was being debated in Parliament, Governors, county leaders and managers were meeting to discuss innovative service delivery strategies to boost OSR collections at the inaugural OSR Growth Conference held at the Kenya School of Monetary Studies in Nairobi.
“In the first six months of this fiscal year, counties collected just under KSh 20 billion, the highest amount since devolution. But even with this improved performance, the annual collection will still be less than 30 per cent of the assessed potential, a disappointing outcome,” said Ndiritu Muriithi, former Laikipia Governor and Partner Ecocapp Capital Ltd.
With the growing demands on county governments, relying solely on an equitable share of nationally raised revenue is no longer a sustainable model. During the conference county bosses discussed the challenges hindering optimal service delivery and case studies of counties that have succeeded in growing their OSR.
Gladys Wanga, Governor of Homa Bay County and Dr. Wilber Otichilo, Governor of Vihiga county presented case studies of how their counties have used technology. “Through our Revenue Collection App, we have been able to eliminate loopholes and streamline our collection processes, putting us on a trajectory not only to meet but exceed our revenue targets,” Wanga stated.
“To boost quality health provision, herbalists have been mapped to determine the types of patients and diseases they treat,” said Governor Otichilo when explaining how the county uses data to make decisions.
Counties primarily generate revenue from service fees such as property rates, trade licenses, liquor licensing fees, parking fees, hospital and public health services, and market trade centre fees, among others. If fully optimized, these revenue streams have the potential to collectively generate approximately Ksh. 260.6 billion in own source revenue (OSR) for counties.
“Health services are the best example. If doctors are not attending to patients, there are no consultation fees. If the pharmacies have no medicines to dispense, you cannot expect payments. The same can be said of meat inspection, AI services, livestock movement permits etc. The solution is to ensure services are delivered efficiently and you will see what happens to revenue,” explains Muriithi.