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Originally published by Nation Business
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business
February 28, 2026
4h ago

Development spend fears as debt interest payment to hit Sh1.2trn

Development spend fears as debt interest payment to hit Sh1.2trn

Why your tax shillings are buying less development as debt interest consumes 25pc of the budget...

✨ Key Highlights

Kenya's public debt interest payments are projected to reach a concerning Sh1.2 trillion by the fiscal year 2026/27, threatening to significantly reduce funds available for development spending.

  • The Parliamentary Budget Office (PBO) warns that rising debt interest payments could crowd out essential development initiatives.
  • Interest payments are estimated to consume over 25 percent of the total budget in the current fiscal year 2025/26, amounting to Sh1.1 trillion.
  • The PBO also highlighted inefficiencies in development expenditure absorption, with actual spending lagging behind allocated budgets despite overall budget increases.

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