Treasury warns Kenya’s Sh1.12tn budget deficit threatens fiscal stability
Appearing before the National Assembly’s Public Debt and Privatisation Committee, Treasury Principal Secretary Chris Kiptoo revealed that the projected deficit marks a sharp rise from the Sh901 billion approved in the June 2025 budget. Kenya breaking news | Kenya news today |..
✨ Key Highlights
Kenya's Treasury has warned that a projected budget deficit of Sh1.12 trillion for the upcoming fiscal year poses a significant threat to the nation's fiscal stability, a sharp increase from the previous budget.
- The deficit highlights the unsustainable nature of continued borrowing to bridge the gap between government revenue and expenditure.
- Treasury Principal Secretary Chris Kiptoo emphasized the need for fiscal consolidation and broadening the tax base to ensure more equitable burden-sharing.
- The government plans to finance the deficit primarily through domestic borrowing (Sh924.5 billion), raising concerns about credit availability for the private sector and escalating debt servicing costs.
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Treasury warns Kenya’s Sh1.12tn budget deficit threatens fiscal stability - April 2026
Kenya's Treasury has warned that a projected budget deficit of Sh1.12 trillion for the upcoming fiscal year poses a significant threat to the nation's fiscal stability, a sharp increase from the previous budget. Kenya's National Treasury Principal Secretary, Chris Kiptoo, has acknowledged that the country's reliance on borrowing to finance its budget is unsustainable, even as the government plans to borrow more to cover the deficit for the 2025/26 financial year. The National Treasury has separately hired G&A Advocates for Sh358 million to represent Kenya in a London arbitration case concerning the revoked sale of Sh6.19 billion in Telkom Kenya shares. The Kenyan National Assembly has also approved the government's plan to sell a portion of its stake in Safaricom to Vodacom, allowing the State to offload shares effective April 1, 2026.
