Abstract: The use of performance contracts has been acclaimed as an effective and promising means of improving the performance of public enterprises as well as government departments. The debate in the public sector has been more complex than just increasing the effectiveness of strategic management systems and narrowing the gap between ambitious strategies and annual planning. The Kenyan government acknowledges that over the years there has been poor performance in the public sector, especially in the management of public resources which has hindered the realization of sustainable economic growth. To improve performance, the government has continued to undertake a number of reform measures. The seminar explained the role of county government, the performance contracting, challenges being faced by counties in implementation of performance contract and suggested solution towards effective implementation of performance contract in the counties.