Kenya proposes its largest budget in history, worth 4.82 trillion shillings.
Expanding public spending and supporting development plans in Kenya
Written by: Mohamed Ragab
The National Treasury revealed in Kenya A massive budget proposal for the 2026/2027 fiscal year, amounting to 4.82 trillion Kenyan shillings, would make it the largest in the country's history, reflecting the government's intention to expand public spending and support plans. DevelopmentAmid economic challenges related to high public debt and rising living costs.
According to the details of the proposal, the government aims to collect total revenues of 3.63 trillion shillings, of which 2.99 trillion shillings are ordinary revenues, while the remaining deficit, amounting to about 1.1 trillion shillings, will be financed through borrowing from local and foreign markets.
The draft budget shows a clear reliance on domestic financing, with the government planning to borrow domestically 995.7 billion shillings, the highest level of domestic borrowing in Kenya’s history, while about 116.2 billion shillings will come from external financing sources and international institutions.
New budget allocation
According to reports, the new budget will be distributed across three main axes, including 2.89 trillion shillings for the national government, 1.5 trillion shillings for the United Fund services, and 420 billion shillings allocated to provincial governments, an increase of 5 billion shillings compared to the current allocations.
This distribution reflects the government’s continued commitment to supporting the decentralization system, which gives provinces a greater role in managing public services and development projects, particularly in the areas of health, education and local infrastructure.
The data indicates that recurring spending will account for the largest share of the budget, totaling 3.54 trillion shillings, and includes salaries, operating expenses, and public debt service, while only 749 billion shillings have been allocated for development spending and capital projects.
Within the national government's allocations, the executive branch will receive 2.8 trillion shillings, representing 97% of the central government's total share, of which 1.98 trillion shillings are for recurring expenditures, and 840.6 billion shillings are for development projects.
In contrast, the draft budget allocated 48.69 billion shillings to Parliament, while the judiciary received 30.44 billion shillings, as part of financing constitutional state institutions and ensuring their continued operation.
Complex economic challenges
This budget comes at a time when Kenya is facing complex economic challenges, including high inflation rates, increasing debt burdens, and previous popular protests against taxes and rising prices, making the passage and implementation of the budget a matter of great interest to markets and citizens.
The coming weeks are expected to see extensive discussions within the Kenyan parliament regarding spending priorities and the size of borrowing, amid calls to direct more resources to productive sectors and basic services.
