Embu has emerged as Kenya's best-managed county in the country's first comprehensive fiscal performance scorecard, while Nairobi City County was ranked among the bottom 10 despite controlling the largest county budget, exposing a stark divide in financial management across devolved governments.

The inaugural County Fiscal Performance Measurement Index (CFPMI), developed by Parliament's Parliamentary Budget Office, ranked Embu first among the 47 counties with a composite score of 0.689, while Kisumu finished 47th with a score of 0.285.

The assessment was based on seven key public finance management indicators designed to measure adherence to fiscal responsibility principles under the Constitution and the Public Finance Management Act. The metrics included budget implementation efficiency, development expenditure, own-source revenue performance, expenditure on wages and benefits, pending obligations (pending bills), county assembly expenditure ceilings, and audit outcomes.

The report uses CFPMI, which is described as a scientific, data-driven tool, designed to enable the Senate to objectively assess how counties comply with constitutional and statutory principles of public finance management. It measures adherence to legal thresholds on development expenditure, wage bills, county assembly spending, budget absorption, own-source revenue performance, pending obligations and audit outcomes.

No single county attained the highest overall Grade A in fiscal performance despite more than 12 years of devolution. Only Embu, Narok and Wajir achieved a Grade B, while the remaining 44 counties were classified as either average (Grade C) or weak (Grade D), underscoring the scale of financial management challenges devolved governments still face. Data for the assessment was drawn from reports by the Controller of Budget, the Office of the Auditor-General and the Kenya National Bureau of Statistics (KNBS).

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Senate Speaker Amason Kingi, who launched the report on Thursday, described the index as a landmark instrument that finally addresses a long-standing gap in parliamentary oversight of county finances.

He noted that although the Senate has for years determined how nationally raised revenue is shared among counties, it had lacked "a scientific and objective framework" for measuring whether those resources were being managed prudently.

“It will enable the House to benchmark counties using verifiable indicators, not to shame them, but to identify best practices, expose weaknesses and determine whether public resources are translating into meaningful development for wananchi,” he said.

Each county received a composite score between 0 and 1, which was then used to classify performance into five grades ranging from A (excellent) to E (poor), providing an objective measure of fiscal discipline and financial management across county governments.

Although a handful of counties have made significant strides in prudent financial management, the majority continue to struggle with budget discipline, development spending, revenue mobilisation and expenditure controls more than a decade after devolution.

Embu County Assembly.

Photo credit: File | Nation Media Group

A comparison of the overall rankings for 2023/24 and 2024/25 shows that several counties remained trapped among the country's weakest fiscal performers despite modest improvements nationally. Nairobi City, Kisumu, Kajiado and Kisii featured in the bottom 10 in both financial years, pointing to persistent weaknesses in budget discipline, financial management and fiscal governance.

Nairobi remained at the bottom of the rankings, while Kisumu also stayed in the lowest tier. Other counties such as Nyandarua, Laikipia, Nyamira, Machakos and Mombasa were among the bottom 10 in 2023/24 but improved enough to move out of the lowest group in 2024/25.

The report findings show that larger budgets did not necessarily translate into better budget execution. Nairobi City, with the largest approved budget of about Sh43.1 billion, ranked among the worst performers in budget implementation, while Kericho, with a budget of just Sh9.8 billion, emerged as the country's best-performing county in budgetary implementation.

The Nairobi City County head office.

Photo credit: File I Nation Media Group

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Likewise, Nakuru (Sh25.3 billion), Turkana (Sh16.8 billion) and Kisumu (Sh15.3 billion) all featured among the bottom performers. The findings show that effective financial management is driven more by planning and execution rather than by the size of the budget.

Senate Clerk Jeremiah Nyegenye said the report responds to growing public demand for accountability beyond budget allocations.

"Kenyans don't just want to know how much money was sent to counties. They want to know: Did it build the dispensary? Did it buy the drugs? Did it pay the ECDE teacher? The CFPMI is our answer," he said.

There is also a huge decline in county investment in development projects as counties shift towards recurrent expenditure at the expense of infrastructure and service delivery. The average development expenditure performance score fell from 0.447 in the 2023/24 financial year to 0.373 in 2024/25, with the Parliamentary Budget Office warning that more than half of the 47 counties failed to meet the legal requirement of allocating at least 30 per cent of their budgets to development.

The findings suggest that although counties have made incremental gains in areas such as budget implementation and revenue mobilisation, those improvements have not translated into the level of fiscal discipline, accountability and prudent public finance management required to achieve excellence under the comprehensive assessment framework.

The trend suggests that an increasing share of county resources is being consumed by recurrent costs such as salaries and operations, raising concerns over counties' ability to finance roads, health facilities, water projects and other long-term investments critical to economic growth and improved public services. Kwale emerged as the country's best performer in this category, attaining a perfect CFPMI score of 1.000, followed by Embu (0.916), Kericho (0.849), Mandera (0.815) and Siaya (0.814), all of which earned Grade A for consistently allocating more than the statutory minimum towards development projects.

At the other bottom end of the scale, Turkana ranked last with a score of 0.000, followed by Kisumu (0.059), Nyeri (0.087), Garissa (0.107) and Vihiga (0.127).

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The report also points to a gradual improvement in counties' ability to generate their own revenue, although performance remains uneven. In the 2024/25 financial year, Narok emerged as the best performer in Own-Source Revenue (OSR) with a perfect CFPMI score of 1.000, followed by Nairobi City (0.981), Mombasa (0.918), Kiambu (0.910) and Kajiado (0.907), reflecting strong local revenue mobilisation capacity.

Kisumu Governor Prof Anyang’ Nyong’o speaks during the 42nd Edition of Jukwaa la Usalama at Tom Mboya Labour College, Kisumu, on September 18, 2025.

Photo credit: Alex Odhiambo | Nation Media Group

At the opposite end, Kisumu ranked last with a score of 0.068, preceded by Kakamega (0.106), Homa Bay (0.116), Baringo (0.172) and Lamu (0.193), all of which fell into the poorest performance category. Compared with 2023/24, the report notes a slight improvement in OSR performance nationally, with counties such as Nyandarua making a remarkable leap from the lowest "E" category to a Grade C, signalling successful fiscal reforms.

However, the number of counties in the poorest-performing category increased from four to five, indicating that while some counties strengthened revenue collection, others continued to struggle with weak tax bases, administrative inefficiencies and revenue leakages.

In terms of wage bills, several devolved units continued to spend an unsustainably high proportion of their revenues on salaries and employee benefits. Nyeri emerged as the weakest performer on the wages and benefits indicator with a CFPMI score of 0.215, followed by Nairobi City (0.237), Baringo (0.242), Bomet (0.251), Homa Bay (0.257), Kisii (0.268), Kisumu (0.272), Laikipia (0.282), Elgeyo Marakwet (0.287) and Nyamira (0.289).

Embu emerged top in wage bill management for the 2024/25 financial year, posting a perfect CFPMI score of 1.000 after keeping its personnel expenditure within the legal ceiling of 35 per cent of total revenue. It was followed by Nakuru (0.982), Narok (0.960), Kilifi (0.958) and Tana River (0.948), all of which earned Grade A for maintaining prudent control over salaries and employee benefits. Embu displaced Kilifi, which had topped the category in 2023/24, while Nakuru, Narok, Kilifi and Tana River retained their top positions among the country's best performers across both financial years, demonstrating sustained commitment to fiscal discipline and sustainable public spending. The Parliamentary Budget Office warns that these counties recorded wage-to-revenue ratios ranging between 47.13 per cent and 57.01 per cent, far above the legal ceiling of 35 per cent, leaving fewer resources for development projects and essential public services while raising concerns about the long-term sustainability of county finances.

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Overall, top-ranked counties such as Embu, Narok, Wajir, Kitui, Kilifi and Tana River consistently performed well across multiple fiscal indicators, including budget implementation, development expenditure, wage bill management, audit outcomes and prudent expenditure controls.

Many also maintained sustainable personnel costs and demonstrated stronger budget execution despite operating with relatively modest budgets.

In contrast, bottom-ranked counties including Kisumu, Kakamega, Busia, Bomet, Nairobi City, Baringo, Lamu, Kajiado and Bungoma repeatedly recorded weak performance across several indicators, including excessive wage bills, poor development spending, weak own-source revenue mobilisation, persistent pending bills and unfavourable audit outcomes. It points to the fact that the difference between the best and worst performers is not primarily the amount of money they receive, but rather the quality of financial planning, fiscal discipline, governance and implementation of public finance management practices.

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jmoturi@ke.nationmedia.com | mwangari@ke.nationmedia.com