Kenya’s Debt Hits Ksh 12.8 Trillion as 71% of Revenue Goes to Loan Repayment – Controller of Budget

Controller of Budget Margaret Nyakang’o has revealed that Kenya’s public debt has increased to Ksh 12.82 trillion, warning that the country’s growing debt burden is putting pressure on government finances.

Speaking before the National Assembly’s Public Petitions Committee, Nyakang’o said 60% of the debt is owed locally while 40% is borrowed from external lenders.

She explained that the biggest challenge is that 71% of all revenue collected by the government is used to repay loans, leaving only 29% to run government services and development projects.

“The total public debt stands at Ksh 12.82 trillion. Sixty per cent is domestic and 40 per cent is external. The impact is that 71 per cent of the revenue collected goes to loan repayment, leaving us with only 29 per cent to finance government operations,” Nyakang’o said.

She warned that if the situation continues, the government may have no choice but to keep borrowing to finance its daily operations.

According to the Controller of Budget, Kenya needs better financial planning and stronger measures to reduce excessive borrowing in the future.

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Counties Accused of Misusing Funds

Nyakang’o also raised concerns about how some county governments are spending public money.

She said several counties request funds to pay suppliers but later divert the money to other projects after it has been approved and released.

The Controller of Budget noted that her office has received many complaints from suppliers who remain unpaid despite counties receiving the money meant to settle their bills.

She said her office is working together with the Central Bank of Kenya to develop a system that will help ensure money released for suppliers reaches the intended beneficiaries.

Crackdown on Pending Bills

Nyakang’o warned that counties will face stricter oversight over pending bills ahead of the next General Election.

She said counties should stop carrying unpaid bills from one financial year to another, adding that the practice has affected many businesses waiting for payment.

Makueni Praised for Good Financial Management

While expressing concern over some counties, Nyakang’o commended Makueni County for receiving a clean audit report.

She added that several other counties have also shown improvement in how they manage public finances, although more work is still needed to improve accountability.

Nyakang’o maintained that public funds should only be used for the purposes approved in the budget, saying her office will continue pushing for greater transparency and responsible use of taxpayers’ money.

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