The County Revenue Fund (CRF) is established under Article 207 of the Kenyan Constitution (2010) and further detailed in Section 109 of the Public Finance Management (PFM) Act. The County Treasury manages this fund, which is the primary account for all county government revenues.
🔹 What is the County Revenue Fund (CRF)?
The County Revenue Fund is the main account where all revenues raised or received by a county government are deposited.
✅ It is held at the Central Bank of Kenya (CBK) under the name County Exchequer Account.
✅ It ensures financial discipline and prevents unauthorized spending by county governments.
✅ It serves as the main pool for county revenues, including:
- Equitable share of national revenue.
- Own-source revenue (local taxes, levies, fees, etc.).
- Conditional grants from the national government.
- Donations and loans.
📌 No spending can be made directly from the revenue sources—all funds must first be deposited into the County Revenue Fund before use.
🔹 Key Roles of the County Revenue Fund
1️⃣ Receiving and Managing County Revenues
✔ All revenues collected by the county government must first be deposited into the County Revenue Fund.
✔ Includes: national government allocations, local taxes, fees, licenses, grants, and donations.
2️⃣ Preventing Unauthorized Expenditure
✔ The county government cannot withdraw money from the CRF without the approval of the Controller of Budget.
✔ This ensures:
- Transparency and accountability in county financial management.
- Budgeted funds are used for their intended purposes.
3️⃣ Facilitating County Operations through Withdrawals
✔ Funds in the CRF are transferred to County Operational Accounts after approval.
✔ This allows county departments to carry out government functions, pay salaries, and implement projects.
4️⃣ Ensuring Compliance with the Law
✔ County governments must comply with financial regulations, including:
- Public Finance Management (PFM) Act.
- Constitutional provisions on public finance (Article 207).
✔ The County Treasury must report to the Controller of Budget and the Commission on Revenue Allocation (CRA) on fund usage.
5️⃣ Retaining Unused Funds for Future Use
✔ Unused balances do not lapse at the end of the financial year.
✔ They remain in the CRF for the purposes they were originally allocated.
6️⃣ Enhancing Accountability and Financial Oversight
✔ The County Treasury must submit financial statements to:
- Controller of Budget
- Commission on Revenue Allocation (CRA)
✔ These reports help monitor county spending and prevent misuse of funds.
🔹 What Funds Are Excluded from the County Revenue Fund?
📌 Not all money received by a county goes into the CRF. Some exclusions include:
✔ Appropriations-in-Aid (AIA): Funds generated from county services that can be retained by the entity that collected them.
✔ Special funds established by Parliament or county legislation, e.g., emergency funds or special development funds.
📌 Conclusion
The County Revenue Fund (CRF) is a crucial financial management tool for county governments in Kenya. It ensures accountability, transparency, and fiscal discipline by centralizing all county revenues and preventing unauthorized spending.
By requiring approval from the Controller of Budget before withdrawals, the fund promotes responsible use of public money and supports county development and service delivery. 🚀
