The National Assembly’s Budget and Appropriations Committee has ruled out any possibility of allocating additional funds to ministries and state departments in the 2025/26 financial year, citing a ballooning fiscal deficit of Sh876.1 billion.
As the committee receives budget estimates from various departmental committees, it has expressed deep concern over what it termed as “inaccuracies” in the revenue projections submitted by the National Treasury. To bridge the deficit, Treasury plans to borrow Sh592.1 billion locally and Sh284 billion externally.
The government has set the overall budget for the financial year starting July 1 at Sh3.36 trillion. Of this, Sh1.7 trillion is earmarked for recurrent expenditure, while Sh707 billion is allocated to development—a figure that MPs say marks a significant decline in development spending, now down to just 17% of the total budget.
Lawmakers say the budget proposals currently under consideration reflect severe funding cuts across nearly all ministries, departments, and agencies, compared to allocations outlined in the earlier Budget Policy Statement.
Labour and Social Welfare Committee Chairperson Ken Chonga criticized the Sh1.1 billion cut to the State Department for Labour and Skills Development, terming it detrimental and calling for its reinstatement.
Meanwhile, former Budget Committee Chair Ndindi Nyoro questioned the Treasury’s calculations of the deficit-to-GDP ratio, suggesting the figures may have been manipulated to facilitate external borrowing.
The Parliamentary Budget Office (PBO), which advises MPs on fiscal matters, acknowledged the concerns but urged legislators to direct such queries to the Treasury for clarification.
Despite increasing pressure from various ministries for additional resources, the Budget and Appropriations Committee reiterated that with such a significant funding shortfall, no additional allocations or reinstatements would be considered.
The committee is expected to continue reviewing budget proposals in the coming weeks, with final allocations to be determined ahead of the national budget presentation scheduled for June.