The Cabinet of Kenya has officially endorsed the Budget Policy Statement for the financial year 2026/27, which is set at an impressive KSh 4.7 trillion. According to a dispatch from State House, the budget projects total revenues of KSh 3.5 trillion, highlighting a significant budget deficit that needs addressing. The Cabinet has emphasized the importance of balancing expenditures with sustainable revenue generation to maintain fiscal responsibility.

Key allocations within this budget include KSh 3.46 trillion earmarked for recurrent spending and KSh 749.5 billion designated for developmental projects. Moreover, the Cabinet plans to allocate KSh 495.7 billion in transfers to county governments, which showcases an effort to support local governance structures and ensure equitable distribution of resources. Additionally, KSh 2 billion is set aside for the Contingency Fund, allowing for unforeseen expenditures that may arise during the fiscal period.

In accordance with the Division of Revenue Bill, county governments are slated to receive KSh 420 billion as an equitable share based on constitutional requirements. This allocation is a representation of 21.9 percent of the most recent audited revenue, which aligns with principles of decentralization and empowers local authorities. The government’s continued commitment to the Equalisation Fund, in addition to the proposed county additional allocations, illustrates a comprehensive approach to governance and financial management aimed at fostering development at the county level.