Live blog: Treasury CS John Mbadi presents Sh4.2 trillion budget before Parliament

Sh10.7 billion for Forests, Resources, Conservation and Management

Sh1.6 billion for Forests Research and Development

Sh3.7 billion for Environment Management and Protection

Sh11.5 billion for the Kenya Financing Locally Led Climate Action Project

Sh1.6 billion for the Meteorological Service

Sh13.2 billion for wildlife security, conservation and management

Sh953 million for wildlife research and development

Sh1.1 billion for Human Wildlife Conflict compensation

Sh950 million for Wildlife Insurance

Sh26.8 billion for water and sewerage infrastructure development

Sh16.5 billion for water resources management

Sh1.9 billion for water storage and flood control.

Sh15.0 billion for irrigation and land reclamation

Sh266 million for water harvesting and storage for irrigation

Sh105.6 billion to empower the youth and support businesses owned by youth and women, and promote development in the constituencies

This allocation includes:

Sh10.0 billion for the National Youth Service

Sh3.6 billion to the National Youth Opportunity Towards Advancement (NYOTA)

Sh318 million for the Youth Enterprise Development Fund.

Sh990 million for Film Development Services

Sh353 million for the Women Enterprise Fund

Sh940 million for the provision of sanitary towels to school-going girls

Sh254 million for Strengthening Prevention & Response to Gender Based Violence in Kenya

Sh110 million for the eradication of Female Genital Mutilation

Sh4.0 billion for the National Government Affirmative Action Fund

Sh29.7 billion to support Sports, Culture and recreation as well as Tourism.

This proposed allocation includes:

Sh13.5 billion for the Sports, Arts and Social Development Fund

Sh2.3 billion to establish an Automation and Digitalisation System for the Sports Registrar

Sh241 million for the Anti-Doping Agency of Kenya

Sh402 million for Sports Kenya

Sh245 million for the Kenya Academy of Sports

Sh8.2 billion for the Tourism Fund

Sh4.8 billion for Tourism Promotion Fund

Sh41.4 billion in this budget to protect the vulnerable members of our society and promote affirmative action

This includes:

Sh25.1 billion to cater for cash transfers to elderly persons

Sh8.9 billion for cash transfers to Orphans and Vulnerable Children

Sh1.5 billion for cash transfers to persons living with severe disabilities

Sh202.3 billion for Defence

Sh125.7 billion for the National Police Service

Sh51.4 billion for the National Intelligence Service

Sh32.5 billion for Internal Security and National Administration

Sh38.1 billion for Prisons Services

Sh10.0 billion to cater for the leasing of police motor vehicles

Sh3.6 billion for Police Modernisation Programme

Sh1.2 billion for the construction and modernisation of National Forensic Facilities

Sh18.0 billion under various implementing Ministries, Departments and Agencies

Sh4.5 billion will support the establishment of County Integrated Agro-Industrial Parks

Sh2.8 billion for Supporting Access to Finance & Enterprise Recovery (SAFER) Project

Sh602 million for the development of Athi River Textile Hub

Sh705 million for the establishment of flagship Export Processing Zones Hubs

Sh504 million for the development of Special Economic Zone Textile Park Naivasha

Sh798 million for Kenya Jobs and Economic Transformation

Sh 702.7 billion to the Education sector

This includes:

Sh387.2 billion to the Teachers Service Commission (TSC). (Sh7.2 billion for the recruitment of intern teachers and Sh980 million for the capacity building of teachers on Competency-Based Education)

Sh7.0 billion for Free Primary Education

Sh28.9 billion for Junior Secondary School capitation

Sh993 million for Research, Science, Technology and Innovation

Sh41.5 billion to the Higher Education Loans Board for the provision of loans to University and TVET students

Sh16.9 billion for Scholarship for University Students

Sh7.7 billion Capitation and Scholarship for TVET students

Sh51.9 billion for Free Day Secondary education

Sh5.9 billion for administering the National Examinations

Sh3.0 billion for the School Feeding Programme

Sh7.2 billion for the recruitment of Intern Teachers

Sh4.0 billion for the Technical, Vocational Education Training & Entrepreneurship project

Sh1.7 billion for Primary and Secondary Schools’ infrastructure

Sh1.4 billion for the construction and equipping of the Technical Training Institutes and Vocational Training Centres.

Sh13.3 billion for the Kenya Primary Education Equity in Learning Programme

Sh2.3 billion for Kenya Secondary Education Quality Improvement Project

Sh62.8 billion to cater for key energy interventions. This includes:

Sh31.6 billion for the National Grid System

Sh16.3 billion for Rural Electrification

Sh11.5 billion for the development of geothermal energy

Sh2.1 billion for alternative energy technologies

Sh743.8 million for the development of nuclear energy

Sh217.3 billion for the development of roads.

This includes: Sh30.9 billion to support the construction of roads and bridges

Sh70.8 billion for the rehabilitation of roads

Sh115.6 billion for road maintenance

Sh38 billion to expand railway transport

Sh450 million for the Kenya Ferry Ramp in Mombasa

Sh331.2 million for the Nairobi Bus Rapid Transport Project

Sh298.7 million for the promotion of the E-Mobility Project

Sh110.4 million for the Acquisition of Ferries for Lake Victoria

Micro, Small and Medium Enterprise (MSME) Economy allocation

Sh300 million to the Financial Inclusion Fund, popularly known as the Hustler Fund

Sh308 million for the Youth Enterprise Development Fund

Sh550 million for the Centre for Entrepreneurship Project

Sh1.3 billion for Rural Kenya Financial Inclusion Facility

Sh12.7 billion to fund initiatives in the ICT sector.

This includes:

Sh3.1 billion for Konza Data Centre and Smart City facilities

Sh2.3 billion for the construction of the Kenya Advanced Institute of Science and Technology at Konza Technopolis

Sh3.7 billion for Kenya Digital Economy Acceleration Project

Sh333.2 million for government shared services

Sh382 million for the digital superhighway

Sh689 million for the establishment of digital hubs

Sh750 million for the maintenance and rehabilitation of the national optic fibre backbone infrastructure

Sh3.1 billion for Konza Data Centre and Smart City facilities

Sh138.1 billion has been allocated to the health sector to support various activities and programmes. They include:

Sh6.2 billion for UHC coordination and management

Sh13.1 billion for primary healthcare

Sh430 million for medical cover for the orphans, elderly and disabled persons in our society

Sh17.3 billion for HIV/AIDS, Tuberculosis and Malaria, and enhance the vaccines and immunisation programme (Global Fund).

Sh4.6 billion for vaccine and immunisation programmes

Sh8 billion for emergencies, chronic and critical illness fund to be managed SHA

Sh1 billion for the construction of a cancer centre at Kisii Level 5 Hospital

Sh100 million for strengthening cancer management at KNH

Sh100 million for the expansion of comprehensive cancer treatment at Kenyatta University Teaching Referral and Research Hospital

Sh42.4 billion for referral hospitals

Sh1.3 billion for the construction of the KNH bands and paediatric centre

Sh5.2 billion for KEMSA

Sh2.7 billion for KEMRI

Sh500 million for the procurement of family planning and reproductive health commodities

Sh300 million for the procurement of equipment at the National Blood Transfusion Services

Sh4.3 billion for medical interns

Sh3.2 billion for community health promoters

Sh303 million for the training of health personnel

Sh8.9 billion for KMTCs

The Housing, Urban Development and Public Works sub-sector has been allocated Sh128.3 billion.

This includes:

Sh13.4 billion for Kenya Urban Programme

Sh64.5 billion for the construction of affordable housing units

Sh10.5 billion for the construction of social housing units

Sh16.5 billion for social and physical infrastructure

Sh7.2 billion for Kenya Informal Settlement Improvement Project Phase II

Sh3.5 billion for the construction of housing units for the National Police and the Kenya Prisons

Sh2.6 billion for regulation and development of the construction industry

Sh500 million for building climate-resilience of the urban poor programme

Sh184 million for the construction of footbridges

Sh454 million for construction of county HQs

Sh3.8 billion for the settlement of the landless

Sh1.1 billion for processing and registration of title deeds

Sh712 million for the digitisation of land registries

Sh200 million for the geo-referencing of land parcels

Sh220 million for the construction of land registries

The Blue Economy has been allocated a total of Sh8.2 billion

Sh2.3 billion for the aquaculture business development project

Sh2.4 billion for the Kenya Marine Fisheries and Socio-Economic Development project

Sh500 million for Kabonyo Fisheries and Aquaculture Training Sector

Sh2.3 billion for derisking, inclusion and value enhancement of pastoral economies programmes

Sh1.6 billion for Kenya livestock commercialisation programme

Sh280 million for livestock value chain support project

Sh340 million for the development of the leather industrial park

Sh400 million for excess milk mop-up

Sh150 million for the modernisation of milk processing factories in Runyenjes and Narok

Sh10.2 billion for the national agricultural value chain development project

Sh8 billion for the fertiliser subsidy programme

Sh5.8 billion for the food systems resilience project

Sh1.2 billion for the food security and crop diversification project

Sh800 million for small-scale irrigation and value addition project

Sh2.0 billion for Coffee Cherry Revolving Fund

Sh2.0 billion for Coffee Debt Waivers

Sh1.5 billion for the sugar sector reforms

Sh120 million for the modernisation and revitalisation of cotton ginneries

Sh245 million for Horticultural Produce Compliance Enhancement Project

The resultant fiscal deficit, including grants, is projected at Sh923.2 billion, which is equivalent to 4.8 per cent of GDP.

This is down from the estimated Sh997.5 billion or 5.7 per cent of GDP in FY 2024/25.

The fiscal deficit for FY 2025/26 will be financed by net external borrowing of Sh287.7 billion and net domestic borrowing of Sh635.5 billion.

The Cabinet in January approved reforms to streamline state corporations and enhance governance and accountability of these corporations.

The approved reforms include:

The merger of 42 state corporations into 20 entities to improve operational efficiency and eliminate redundancy

Dissolution of 25 state corporations and their functions transferred back to their parent ministries or other state corporations

Restructuring six state corporations to align their mandates for improved performance

Declassification of four public funds currently categorised as state corporations and transferring their functions back to the relevant ministries

Declassification of 13 professional bodies currently categorised as state corporations to private entities with no exchequer budgets.

The government will implement the following initiatives to control the wage bill:

Fully implement the unified human resource management system across all public sector entities by July 2025.

The Salaries and Remuneration Commission (SRC) continues to sustainably reduce the number of allowances in public service through a phased approach aimed at streamlining allowances to improve transparency, accountability, equity and fairness.

To this end, the SRC will progressively review allowances and benefits in the future CBAs, aligning them to the allowances policy guidelines for the public service.

The National Assembly in December removed all taxes on retirement benefits.

The move is aimed at increasing disposable income among pensioners.

The next step is to digitise the identification of pensions to reduce the time it takes to process pension claims.

The government has invested significant resources and implemented radical changes in the education sector.

Among them is rolling out a new student-focused higher education model with special emphasis on students from vulnerable families.

In order to have a financing framework to manage disaster risks, the government is finalising the Public Finance Management (Disaster Risk Management Fund) Regulations 2025.

The regulations seek to establish a dedicated fund for addressing four cycles of preparedness, mitigation, response and recovery.

Inflation rates have declined to 3.8 per cent in May 2025 from a peak of 9.6 per cent in October 2022.

In response to the decline in inflation, CBK has gradually eased monetary policy, lowering the CBK bank rates from 13 per cent in August 2024 to 9.75 per cent in June 2025.

In order to create additional jobs for the youth, the government has begun rolling out Climate WorX and nationwide programme that will engage over 100,000 youth across all 47 counties.

In order to improve governance in the Public Procurement process, I launched the e-procurement system on April 7, 2025.

Beginning July 1, 2025, all procurement by MDAs will be done through e-procurement without any exception.

This will reduce the opaqueness and save government resources estimated at 10 per cent of procurable budgets.

The roll-out of the e-Procurement system is scheduled for July 2025.

Since February 2024, 6.5 million registered farmers have benefited from the fertiliser subsidy programme; as a result, the cost of fertiliser has reduced by 67 per cent, while maize production has increased by 38.9 per cent.

The government has facilitated the construction of affordable housing units across the country.

Since September 2022, 2,379 affordable housing units have been completed across four counties, with another 11,000 units in the last stages of completion.

The government is also supporting the development of institutional housing for the uniformed services and students.

We have reduced revenue projections to be in line with trends. Therefore, revenue projections in the FY 2025/2026 budget and over the medium term are consistent with the growth of the economy.

We adopted the zero-based budget where every budget item has to be justified at the beginning of every financial year.

Kenyans have expressed concerns about the public debt. In this regard, I requested the Auditor-General to conduct a comprehensive audit of public debt. This audit is currently ongoing, and once completed, the report will be shared with this House.

To enhance liquidity in the economy and support small businesses, we have started the process of settling pending bills that have been validated, particularly those related to road construction, which has resulted in the resumption of road construction across the country.

The pending bills verification committee will share their final report by the end of June 2025. This report will be analysed and recommendations tabled in Cabinet for approval, after which we shall embark on the process of clearing the eligible bills, starting with those related to individuals, businesses and MSMEs majority of whom have borne the brunt of non-payment.

The government has received 65,625 claims for pending bills valued at Sh571 billion. From this, 57 per cent, with a value of Sh522 billion, have been reviewed. From the review, claims estimated at Sh229 billion have been recommended for settlement.

We have strengthened public participation in all policy formulation, including the budget-making process.

As a result of consultations with the public, we have focused on easing the tax burden on Kenyans by increasing the pool of taxpayers and enhancing tax compliance.

In this year's budget-making process, we accorded Kenyans an opportunity to share their views on how to address the economic challenges facing our country.

Kenyans have been very resolute in voicing their concerns that include over-taxation and high cost of living, unemployment, the need for protection of the poor and vulnerable and the need to reduce government expenditure and wastage across the national and county governments.

Our Kenyan economy has remained resilient and registered an average growth of 5.2 per cent for the period between 2023 and 2024, outpacing both global growth of 3.3 per cent and 3.8 per cent for the Sub-Saharan region over the same period.

In 2024, the economy grew by 4.7 per cent, supported by positive growth in all sectors except construction and mining.

This growth was lower compared to 5.7 per cent in 2023, mainly due to the adverse effects of floods in the second quarter and the anti-finance bill protests in the third quarter of 2024 that disrupted economic activities