Marginalised communities eye Ksh16B as Equalisation Fund Bill gets senate nod
By Faith Lagat, May 5, 2026The Senate of Kenya’s Standing Committee on Finance and Budget has recommended approval of the Equalisation Fund Appropriation Bill, 2025, paving the way for the release of Ksh16.8 billion to support marginalised communities.
The decision was announced on Tuesday, May 5, 2026, amid concerns over delayed disbursements and funding gaps.
Chaired by Ali Roba, the committee adopted its report on National Assembly Bill No. 21 of 2025 without amendments. The Bill proposes Ksh6.2 billion from the 2024/25 financial year and Ksh10.6 billion for 2025/26 to fund services including water, roads, health facilities, and electricity in 1,424 marginalised areas across 34 counties.
The 2025/26 allocation is based on 0.5 per cent of audited revenues from the 2020/21 financial year, amounting to Ksh7.852 billion, with an additional Ksh2.747 billion aimed at clearing arrears.
“The Senate Standing Committee on Finance and Budget has officially adopted its report on the Equalisation Fund Appropriation Bill, 2025 (National Assembly Bill No. 21 of 2025), and resolved to recommend that the Senate approve the Bill without any amendments,” read the statement in part.
Fund mandate and disbursement challenges
The Equalisation Fund is anchored in the Constitution to address disparities in access to basic services in marginalised regions. The committee noted that the Bill meets the requirement for parliamentary approval of expenditure from the Fund.
However, senators highlighted challenges in implementation, citing significant arrears. According to the report, total outstanding arrears have reached Ksh62.677 billion out of a cumulative entitlement of Ksh79.858 billion.
The committee further noted that since the fund’s inception, only Ksh13.4 billion has been disbursed. The shortfall has affected the pace of development projects intended to improve access to essential services in targeted areas.
Financial controls and oversight measures
The Bill outlines measures to safeguard the funds and ensure accountability in utilisation. Allocations will not be deposited into County Revenue Funds but instead transferred to special-purpose accounts held at the Central Bank of Kenya.
Withdrawals from these accounts will require approval from the Controller of Budget, based on instructions issued through the National Treasury by the Equalisation Fund Advisory Board.
Additionally, Ksh504 million has been allocated for administrative expenses of the secretariat and board, in line with Public Finance Management regulations that cap such costs at three per cent of the annual allocation.
Next steps and policy framework
Following the adoption of the report, the committee is expected to table it before the Senate for debate and consideration. If approved, the Bill will be forwarded for presidential assent, enabling the release of the funds for identified projects.
The Commission on Revenue Allocation is also finalising the Third Marginalisation Policy, which will guide allocation criteria from the 2026/27 financial year.
The proposed funding targets projects in marginalised sub-locations identified under existing policy frameworks, with implementation dependent on approvals and subsequent disbursement processes.