The National Assembly has approved a Sh405 billion allocation to county governments for the 2025/26 financial year. Additional funds include Sh69.8 billion for supplementary allocations and Sh7.9 billion for the Equalization Fund. The 2025 Budget Policy Statement outlines the government’s economic strategies and priorities, emphasizing expenditure rationalization and prioritization to support economic recovery and public welfare.
The National Assembly of Kenya has approved a Sh405 billion allocation for county governments as equitable revenue share for the 2025/26 financial year. Additionally, counties will receive Sh69.8 billion in supplementary allocations, which is detailed in the Budget Policy Statement (BPS) and will inform the relevant legislation for additional county funding in the upcoming financial year.
Furthermore, the government budget ceiling has been set at Sh2.5 trillion, with Sh2.4 trillion allocated to the Executive, Sh49.5 billion to Parliament, and Sh26.7 billion to the Judiciary. The Equalization Fund will receive Sh7.9 billion, along with an extra Sh3.5 billion to cover arrears. Public participation initiatives have an allocated budget of Sh3 billion, while the Office of the Auditor General has been assigned Sh8.7 billion.
The 2025 BPS highlights the government’s strategic priorities and assesses the current economic landscape, providing a macro-fiscal outlook and summarizing spending plans. The publication aims to enhance public understanding of Kenya’s finances and foster discussion on economic and developmental issues.
According to the National Treasury, the policy measures outlined in the BPS intend to improve efficiency across the economy, cultivate a conducive business environment, alleviate living costs, and enhance the overall wellbeing of citizens. This tight fiscal approach is anticipated to mitigate debt vulnerabilities via reforms aimed at expanding the tax base and improving compliance.
The BPS emphasizes the need for expenditure rationalization to enhance public investment efficiency while ensuring that subsidies and transfers are well-targeted. It is crucial for government ministries and agencies to evaluate existing or planned projects, prioritizing key service-delivery programs over low-priority expenditures. Sector Working Groups must also work to eliminate wasteful spending to support economic recovery and job creation.
In summary, the National Assembly’s approval of the allocation of Sh405 billion to counties for the 2025/26 fiscal year underscores the government’s commitment to equitable resource distribution. The Budget Policy Statement outlines strategic priorities and fiscal measures intended to improve economic efficiency and wellbeing for all Kenyans. Rigorous prioritization and evaluation of resources are essential as the government addresses financial constraints, ensuring that high-priority programs are adequately funded while eliminating unnecessary expenditures.
Original Source: www.capitalfm.co.ke
