Budget FY 2025/26 Highlights
The National Treasury Cabinet Secretary, Hon. John Mbadi, this week delivered his first official Budget Day speech before the National Assembly under the theme: “Stimulating Sustainable Economic Recovery for Improved Livelihoods, Job Creation, and Business and Industrial Prosperity in Line with the Bottom-Up Economic Transformation Agenda.”
In recognition of geopolitical factors and domestic financial challenges facing Kenya, the National Treasury has responded to concerns over unrealistic revenue projections and revised them to align more closely with actual trends. This year’s budget, therefore, places a strong emphasis on easing the tax burden on citizens.
The proposed national budget for the 2025/2026 Financial Year stands at Ksh 4.239 trillion. This comprises Ksh 2.75 trillion in ordinary revenue( majority of which will be collected from Income tax at 38.7 per cent),Ksh 576 million in non-tax revenue, Ksh 46.9 billion in grants, and a projected deficit of Ksh 932.2 billion.
The plan for deficit financing includes Net Foreign Financing of Ksh 287.7 billion and Net Domestic Financing of Ksh 635.5 billion.
Allocation to thematic areas under the Bottom-up Economic Transformation Agenda (BETA)
| Priority | Amount Allocated |
| Education | Ksh 658.4 billion |
| Allocation to County Governments | Ksh 474.9 billion |
| National Security | Ksh 464.6 billion |
| Investing in Critical Infrastructure | Ksh 318.1 billion |
| Health Sector | Ksh 133.4 billion |
| Housing & Urban Development and Public Works | Ksh 120.2 billion |
| Equity, Poverty Reduction, Women, and Youth Empowerment | Ksh 105.6 billion |
| Environmental Protection, Water, and Natural Resources | Ksh 103.8 billion |
| Governance and Justice | Ksh 47.7 billion |
| Agriculture and Food Security | Ksh 47.6 billion |
| Social Protection and Affirmative Action | Ksh 41.3 billion |
| Stimulating Tourism Growth, Sports, Culture, Recreation, and Arts | Ksh 29.7 billion |
| Manufacturing and Industrialisation | Ksh 18.0 billion |
| Information, Communication and Technology (ICT) | Ksh 12.7 billion |
| Equalisation Fund | Ksh 10.59 billion |
Agriculture
In the FY 2025/26 budget, Ksh 47.6 billion has been allocated. Key allocations in this budget include:
| Priority | Amount Allocated |
| National Agricultural Value Chain Development Project (NAVCDP) | Ksh 10.2 billion |
| Fertiliser Subsidy Programme | Ksh 8.0 billion |
| Food Systems Resilience Project | Ksh 5.8 billion |
| Blue Economy Priority Projects | Ksh 5.2 billion |
| Settlement of the Landless | Ksh 3.8 billion |
| De-risking, Inclusion & Value Enhancement of Pastoral Economies Programme | Ksh 2.3 billion |
| Kenya Livestock Commercialisation Programme | Ksh 1.6 billion |
| Sugar Reforms | Ksh 1.5 billion |
| Food Security and Crop Diversification Project | Ksh 1.2 billion |
| Processing and Registration of Title Deeds | Ksh 1.1 billion |
| Digitisation and Construction of Land Registries | Ksh 0.9 billion |
| Small Scale Irrigation and Value Addition Project | Ksh 0.8 billion |
| Ending Drought Emergency in Kenya | Ksh 0.3 billion |
Health
The Government continues to promote access to quality and affordable healthcare through the Universal Health Coverage (UHC) programme, ensuring all Kenyans can receive the care they need without financial hardship. In FY 2025/26 Budget, the sector has been allocated Ksh 133.4 billion:
| Priority | Amount Allocated |
| Kenyatta National Hospital | Ksh 18.7 billion |
| Global Fund (HIV, Malaria, TB) | Ksh 17.3 billion |
| Primary Healthcare Fund | Ksh 13.1 billion |
| Moi Referral and Teaching Hospital | Ksh 10.8 billion |
| Emergency, Chronic and Critical Illness Fund | Ksh 8.0 billion |
| Universal Health Coverage Coordination and Management | Ksh 6.2 billion |
| Vaccines and Immunisations Programme | Ksh 4.6 billion |
| Reproductive, Maternal, Neonatal Child & Adolescent Health Communities | Ksh 3.8 billion |
| KNH Burns and Paediatrics Centre | Ksh 1.3 billion |
| Construction and Strengthening of Cancer Centres | Ksh 1.3 billion |
| Health Emergency Preparedness, Responses & Resilience Programme | Ksh 1.1 billion |
| Building Resilience and Responsive Health System Project | Ksh 1.1 billion |
ICT & Digital Economy
The Government continues to invest in the Digital Superhighway and creative economy to boost productivity and competitiveness under the BETA agenda. Enhanced ICT infrastructure and wider internet access are key goals, while the creative industry provides vital job opportunities for youth and helps tackle unemployment. This thematic area has an allocation of Ksh 12.7 billion in the FY 2025/26. Allocations include:
| Priority | Amount Allocated |
| Kenya Digital Economy Acceleration Project | Ksh 3.7 billion |
| Konza Data Centre & Smart City Facilities | Ksh 3.1 billion |
| Construction of KAIST at Konza Technopolis | Ksh 2.3 billion |
| Digital Superhighway, Government Shared Services and Digital Hubs | Ksh 1.4 billion |
| Maintenance & Rehabilitation Connectivity Networks | Ksh 1.0 billion |
| E-government Procurement | Ksh 0.7 billion |
National Security
The Government continues to ensure the safety and well-being of its citizens as a key enabler of economic advancement and national prosperity. Recognising the critical role, Ksh 464.9 billion has been allocated in the FY 2025/26 to support operations of the National Police Service, Defence, the National Intelligence Service and Prison Services. Other proposed allocations include:
| Priority | Amount Allocated |
| Lease Financing of Police Motor Vehicles | Ksh 10.0 billion |
| Police Modernization Programme | Ksh 3.6 billion |
| Construction and Modernisation of National Forensic facilities | Ksh 1.1 billion |
Manufacturing
To continue promoting local industries, Ksh 18.0 billion has been allocated under various implementing Ministries, Departments and Agencies. Key proposed allocations to the sector include:
| Priority | Amount Allocated |
| Establishment of County Integrated Agro-Industrial Parks | Ksh 4.5 billion |
| Coffee Debt Waiver and Coffee Cherry Revolving Fund | Ksh 4.0 billion |
| Finance & Enterprise Recovery (SAFER) Project | Ksh 2.8 billion |
| Rural Kenya Financial Inclusion Facility | Ksh 1.3 billion |
| Development of SEZ Textile Park Naivasha and Athi River Textile Hub | Ksh 1.1 billion |
| Flagship Export Processing Zone Hubs (EPZA) | Ksh 0.7 billion |
Energy
The Government has boosted energy access and clean power generation, added 774,000 electricity connections, and expanded infrastructure. Plans include more renewables, oil field development, wider LPG use, and accelerating the shift to electric mobility to cut emissions and improve transport. The sector has been allocated Ksh 62.8 billion in FY 2025/26 as follows:
| Priority |
Amount Allocated |
| National Grid System | Ksh 31.6 billion |
| Rural Electrification | Ksh 16.3 billion |
| Geothermal Generation | Ksh 11.5 billion |
| Alternative Energy Technologies | Ksh 2.1 billion |
| Development of Nuclear Energy | Ksh 0.7 billion |