NAIROBI, Kenya — The National Treasury has acknowledged a significant error in the Budget Policy Statement (BPS) submitted to Parliament, admitting that Sh73 billion was mistakenly included in ministerial expenditure.
The government is now seeking parliamentary approval to amend the figures and align them with the actual fiscal framework.
In a letter dated February 25, 2025, Treasury requested the National Assembly to approve a reduction of Sh73 billion from the State Department for Medical Services’ budget.
The error stemmed from the misallocation of funds earmarked for the Social Health Insurance Fund (SHIF), which was included in ministerial spending but had not been factored into the broader fiscal framework.
“However, the said amount is not included in the fiscal framework, thus causing the difference between Sh4.336 trillion and Sh4.263 trillion,” the letter states.
The National Assembly Committee on Finance and National Planning was the first to flag the inconsistency during a meeting with Treasury officials last month.
Lawmakers noted that Treasury documents contained conflicting figures for the 2025/26 budget: one version listed the total expenditure as Sh4.263 trillion, while another put it at Sh4.336 trillion.
Further scrutiny revealed that the initial budget breakdown allocated Sh3.096 trillion for recurrent expenditure, Sh725.1 billion for development projects, Sh436 billion for county government transfers, and Sh5 billion for the Contingency Fund.
However, another Treasury document presented different allocations, including Sh2.562 trillion for the National Government, Sh2.493 trillion for the Executive, Sh42.4 billion for Parliament, Sh25.7 billion for the Judiciary, and Sh405 billion for county revenue allocations.
Treasury Cabinet Secretary John Mbadi assured Parliament that once the correction is made, the total ministerial expenditure will stand at Sh4.2 trillion, ensuring consistency across budgetary documents.
National Assembly Majority Leader Kimani Ichung’wah praised lawmakers for catching the discrepancy, underscoring the importance of accuracy in budget planning.
“I hope this letter now clarifies the issue because we don’t want another computer error,” he remarked, in a veiled reference to previous financial miscalculations that have raised concerns about transparency in government spending.
The admission of the Sh73 billion misallocation has intensified calls for stricter oversight in Kenya’s budgeting process.
With the 2025/26 financial year budget still under review, MPs are pushing for enhanced scrutiny to prevent similar errors that could impact service delivery and economic planning.
