President William Ruto has advised governors to prioritize raising their own sources of revenue.
Speaking during the launch of the Second Kenya Urban Support Programme at State House Nairobi, Ruto stated that counties should copy the trend set by the national government in raising its own taxes.
He explained that the government has failed to raise the funds required to support the urban development strategy.
The head of state also urged governors to utilize World Bank’s $350 million (Ksh46.5 billion) funding for the Second Kenya Urban Support Programme responsibly for maximum benefit but prioritize raising their own revenue going forward.
“Equally critical is for county governments to increase their source of revenues and allocate a greater portion to urban development initiatives,” he said.
Ruto Explains Importance of Own Source Revenue
The president stated that the National Government is establishing the National Urban Development Fund to anchor the urban development agenda in a sustainable framework.
Ruto emphasized that the Ksh46.5 billion is a loan that the government will be required to pay after a period of time.
He explained that the World Bank collects money from other stable countries to help support the activities of Kenya.
“This money is a loan; it is loan and not free money. It is money that has been contributed by other countries. These countries have had to collect money from their citizens and give it to the World Bank so that it can loan it to us,” he said.
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He challenged the counties to grow their revenue emphasizing that the World Bank doesn’t provide money for free.
“Even us we use other people’s savings; we must begin to grow our own savings. That is the message because we have to pay this loan,” Ruto said.
“We must begin to internalize our own source revenue, the same way nationally we are internalizing raising our own taxes. It is just as simple as that. There is no free lunch anywhere in the world.”
The President thanked the World Bank for its support to Kenya but told the leaders and citizens to understand that the fund is a loan.
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How it Will Help Governors
Ruto advised the governors to build capacity to raise their own revenue adding that it will ease their administering work.
“So, as we look for the loan, at the back of our mind we must think in future how do we make sure we don’t have to look for a loan and we will build capacity to raise our own revenue. My friends’ governors, let us focus on our own source revenue. It will make your work very easy,” he stated.
He mentioned that the World Bank has listed tight conditions to the funds to make sure that the country is able to pay back.
According to Ruto, increasing own source revenue will ensure that the partnership between Kenya and the World Bank is strong and meaningful.
He said the counties must start raising their own source of revenue even as the country appreciates the Bank’s support.
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