Financial Resource Mobilization and Counties’ Sustainable Development in Kenya: A Case Study of Tharaka Nithi County Government
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Date
2025-09
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Kenyatta University
Abstract
County governments in Kenya are constitutionally assigned fourteen responsibilities, which demand substantial financial resources beyond the allocations received from the national government. However, local governments have historically faced financial constraints and inefficiencies, creating a persistent gap between their potential revenue generation and actual fiscal performance. Tharaka Nithi County, like many others, has underperformed in mobilizing local revenue despite its capacity to enhance fiscal independence. This study sought to investigate the effect of financial resource mobilization on sustainable development in Tharaka Nithi County, Kenya. The specific objectives were to determine the effect of revenue diversification on sustainable development in Tharaka Nithi County Government, to evaluate the effect of budget utilization efficiency on sustainable development in Tharaka Nithi County Government and to analyse the effect of community participation on the relationship between financial resource mobilization and sustainable development in Tharaka Nithi County Government.. The study was guided by the Public Goods Theory and the Sustainable Development Theory and employed a mixed-methods design, combining quantitative and qualitative approaches. Data were collected through questionnaires and interviews involving county officials, national government personnel, and local citizens, using both stratified random and purposive sampling techniques. Reliability and validity of the research instruments were ensured through pilot testing, expert review, and statistical checks, while ethical research standards were strictly observed. Data were analyzed using Microsoft Excel and SPSS and presented thematically and descriptively. Findings revealed that taxes and levies, grants and transfers, public-private partnerships, and county enterprises income all played a significant role in promoting sustainable development within the county. These revenue streams contributed to infrastructure development, improved service delivery, and promoted inclusive growth. However, the study also established that several challenges hindered effective financial mobilization, including an inflated public payroll, ethnically-driven politics, illicit financial outflows, overreliance on external borrowing, and widespread corruption. The study concluded that strengthening Own Source Revenue is vital for reinforcing county-level sustainable development, as it enhances fiscal resilience, funds essential services, and reduces dependency on national allocations. It recommended that Tharaka Nithi County should expand its revenue base by formalizing the informal sector, streamlining tax procedures, and fortifying institutional and legal frameworks. Moreover, leveraging public-private partnerships can facilitate infrastructure projects, promote economic growth, and enhance service delivery, thereby ensuring long-term sustainable development.
Description
A Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfilment of the Requirements for the Award of the Degree of Master of Business Administration (Finance) of Kenyatta University, September 2025.
Supervisor
1.Anthony Mugetha Irungu