Governors have issued a 14-day ultimatum to the national government, threatening to halt services in counties over claims of diverted funds intended for county operations.
Addressing the press on Friday after an extraordinary council meeting, the county bosses urged the national government to restore the funds.
Additionally, they have demanded an immediate release of the county equitable share of Sh78 billion which they claimed is in arrears for three months starting January.
They also allege that conditional grants from development partners, earmarked for specific projects, were diverted during the passage of the County Governments Additional Allocation Bill, 2025.
In a statement, Council of Governors (CoG) vice chairperson Mutahi Kahiga described the alleged diversion as a deliberate attempt to undermine service delivery across the 47 counties, calling it a setback to the devolution agenda.
According to Kahiga, counties stand to lose Sh38.4 billion in additional allocations, including Sh24 billion in conditional grants from donors.
Out of this, he said, Sh24 billion are conditional grants from donors meant to support various projects in health, agriculture, fisheries, water, roads, slum upgrading and infrastructure development.
The other Sh13 billion additional allocations from the national government, he added, is to fund jointly agreed ongoing projects such as industrial parks.
Kahiga further criticized the national government, stating that the reduction in county allocations contrasts with a Sh114 billion increase in national government expenditure under the recently enacted Supplementary Appropriation Act, 2025.
The Treasury has attributed the budget cuts to low absorption rates of additional allocations in the current financial year.
However, the governors have dismissed this explanation, calling it a misrepresentation of the challenges faced by counties and a reflection of the national government's approach to the devolution agenda.
The governors argue that the consistent reduction in county funding is a deliberate strategy to weaken devolution and hinder service delivery at the local level.
