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Central Government Grants to Local Authorities: A Case Study of Kenya

Published online by Cambridge University Press:  23 May 2014

A.M. Sharp  and
N.M. Jetha
A.M. Sharp
Affiliation:
Oklahoma State University, Stillwater, Oklahoma
N.M. Jetha
Affiliation:
Ministry of Economic Planning and Development, Nairobi, Kenya
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Extract

The major services afforded by local authorities in Kenya are primary education, health, housing, roads and water supplies. Local authorities finance these services from taxes (graduated personal tax, land rates and cesses), school fees, other fees and charges, and government grants. Significant variation in per capita government services in urban and rural areas and the difference in the relative importance of revenue sources of Municipal and County Councils are the dominant features of the expenditure and revenue systems of local authorities in Kenya.

Municipalities spent L8.8 million in 1966 as compared to Lll million spent by County Councils in Kenya. However, more than 90 percent of Kenya's population live in rural areas. The per capita expenditures of Municipalities are more than ten times higher than the per capita expenditures of County Councils. It would be expected that per capita local government expenditures would be higher in Municipalities because per capita government expenditures are directly related to population density and Municipalities have a greater variety of services to provide. The wide variations that exist in per capita expenditures of Municipalities and County Councils in Kenya may reflect also the difference in the fiscal abilities of these major local authorities.

County Councils in Kenya have only one major tax source, the graduated personal tax, and derive only 29 per cent of their revenue from taxes. Municipalities, on the other hand, collect 55 per cent of their revenue from taxes and have two major tax sources, graduated personal tax and land rates (taxes levied on the site value of land).

Type
Research Article
Information
African Studies Review , Volume 13 , Issue 1 , April 1970 , pp. 43 - 56
Copyright
Copyright © African Studies Association 1970

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References

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