Second policy and criteria for sharing revenue among marginalised areas, Commission on Revenue Allocation (CRA), 2018

The Constitution mandates the Commission to determine, publish and regulary review a policy in which it sets out the criteria by which to identify the marginalised areas for purposes of the Equalisation Fund. The first such policy was published in 2013 and used county as the unit of focus. This second policy, focus has shifted from the identification of marginalised counties to identification of marginalised areas, guided by the smallest administrative unit for which data is available. This meant that deprived areas in otherwise well-developed counties had a chance of being identified as marginalised. Similarly, developed areas in otherwise poor counties would be excluded from consideration. To identify marginalised areas, an index of deprivation was constructed by using information on access to safe water, school attendance, access to improved sanitation and electricity, using the principal component analysis. The deprivation index was used to rank 7,131 areas from the most deprived to the least deprived