📉 Kenya at a Crossroads: Will Misplaced Spending Push the Cost of Living Higher?
As Kenyans brace for the reading of the 2025/26 national budget, the country stands on the edge of a deepening crisis. Budget estimates indicate a planned expenditure of KSh 4.24 trillion against projected revenues of KSh 3.32 trillion—leaving a worrying deficit of KSh 876.1 billion. The government intends to cover this gap through domestic borrowing, pushing Kenya’s public debt beyond KSh 11.35 trillion.
But beyond the numbers lies a bigger concern: Are we spending on the right priorities?
⚠️ Mounting Debt, Shrinking Services
The Okoa Uchumi Campaign warns that the new Finance Bill 2025 does not adequately address the reckless government spending habits. Instead of realigning resources toward crucial services, the bill appears to favor tax privileges for elite players while placing a heavier burden on ordinary Kenyans.
Key proposals include:
Raising tax-exempt per diem allowances for senior officials from KSh 2,000 to KSh 10,000.
Granting the Kenya Revenue Authority (KRA) the ability to access private bank and mobile money records without a court order—posing serious privacy concerns.
Favoring Special Economic Zones (SEZs) with reduced taxes, possibly shielding the politically connected.
Reducing tax on select steel imports, likely benefiting major importers over local manufacturers.
🍲 Skyrocketing Prices for Essentials
Perhaps most alarming is the plan to shift vital goods such as medicine raw materials, solar panels, electric vehicles, and animal feed from zero-rated to VAT-exempt. This subtle tax tweak will block producers from claiming input tax, increasing the cost of goods.
Result?
Rising prices for food, healthcare, green energy, and transport—with the poorest Kenyans hit hardest.
Farmers face a fertilizer subsidy cut from KSh 14B to KSh 8B, even as more farmers are expected to benefit. Meanwhile, free primary education faces a KSh 4.3B budget slash, with 50,000 children likely to miss out on school meals due to a KSh 600 million cut.
🏥 Mixed Signals on Health, Education, and Rights
While some positive moves are noted—such as KSh 6 billion allocated to the primary health care fund—others remain neglected:
Linda Mama, the free maternity program, receives zero funding.
The national AIDS control program faces no increase, despite a KSh 9.4B shortfall following the U.S. aid suspension.
Education investments favor TVETs and HELB loans, but neglect vulnerable primary-level learners.
Even more troubling is the rise in funding for police and executive offices, despite past incidents of state violence and human rights violations. The Judiciary and oversight bodies remain underfunded, raising red flags over government accountability and citizens' rights.
🧾 Who Pays the Price?
The government spends over 49% of its budget on debt repayment. For every KSh 100 collected in revenue, KSh 60 goes to paying debt—leaving little for development or county transfers.
Citizens are also warned to stay vigilant about supplementary budgets, which often redirect funds mid-year without public input. Recent examples show funds being moved from safety nets to offices like the President’s and Deputy President’s—violating public participation laws and increasing recurrent expenditure.
🔁 Time for Realignment
Okoa Uchumi Campaign calls for urgent fiscal reforms:
Eliminate wasteful and duplicate expenditures.
Reinstate funding to essential services like health, education, and agriculture.
Protect citizen rights and privacy.
Focus spending on uplifting the many—not enriching the few.
“Kenya cannot tax its way out of this crisis. It must spend better,” the campaign states. Parliament must reject regressive proposals and push for an equitable, people-first budget.
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By Evans Munene Muguna | Trinity Media Production | @KenyaNewsAgency
📞 Contact: 0743231496
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