Kenya’s Parliament is set to establish a mediation committee after the National Assembly rejected amendments proposed by the Senate on the Division of Revenue Bill.The disagreement centres on how revenue shortfalls should be handled between the national government and county governments.

Senators had proposed that the national government should fully absorb any revenue deficits recorded during the financial period, but Members of Parliament opposed the move, arguing that it could interfere with other planned government expenditures and development projects.Under Article 113 of the Constitution, a mediation committee is formed whenever the National Assembly and Senate fail to agree on a Bill.

The committee, made up of members from both Houses, will now try to negotiate a compromise on the revenue-sharing formula before the budget process proceeds further.Majority Leader Kimani Ichungwah and Minority Leader Junet Mohammed cautioned MPs about the financial implications of the Senate’s proposal.

Ichungwah noted that this is the last major budget cycle before the 2027 General Election campaigns begin, urging legislators to ensure key national government projects are completed within the current budget framework.The Senate had approved recommendations from its Finance and Budget Committee allocating counties Ksh454.74 billion as equitable share revenue, representing 22.2 percent of audited revenues from the 2022/23 financial year.Under the same proposal, the national government would retain Ksh2.437 trillion from the Ksh2.902 trillion shareable revenue, while the Equalisation Fund would receive Ksh10.25 billion.The mediation process is expected to determine a final agreement that balances county funding needs with national government budget priorities.