Treasury Releases Sh40 Billion to Keep Government Services Running Amid Budget Uncertainty

NAIROBI, Kenya, Aug 21 — The National Treasury has disbursed Sh40 billion to key government ministries in an effort to prevent service disruptions following weeks of fiscal uncertainty. The release covers critical sectors including education, agriculture, roads, investment promotion, and county industrial development, marking one of the largest mid-term interventions by the exchequer this financial year.
A substantial share of the funds—Sh29.7 billion—has gone to the Ministry of Education to ensure smooth operations as learners enter the third term. The allocation includes Sh1.6 billion for Free Primary Education, Sh14.1 billion for Free Day Secondary Education, and Sh6.1 billion for Junior Secondary Schools. Higher learning institutions have also benefited, with Sh5.1 billion directed to the Higher Education Loans Board (HELB) to support student financing, while the Universities Fund Board received Sh2.8 billion to sustain public universities grappling with operational shortfalls. Other ministries have also received significant boosts: the Ministry of Agriculture was allocated Sh4.6 billion, including Sh2.6 billion for the National Irrigation Authority to strengthen irrigation projects, and Sh2 billion for the National Cereals and Produce Board to settle pending fertilizer-related bills. Additionally, Sh800 million has gone to the New Kenya Cooperative Creameries (KCC), and Sh500 million to the Hustler Fund aimed at supporting small businesses.
The allocations come at a politically sensitive moment, following the dramatic withdrawal of the Finance Bill 2024, which triggered nationwide protests led largely by Gen Z. Critics argued the bill was punitive and poorly timed amid rising living costs, forcing President William Ruto to shelve it and decline to sign it into law. Although the government had expected to raise $2.67 billion in new revenue through the bill, its collapse left gaps that the Treasury is now scrambling to manage through careful expenditure prioritization.
Looking ahead, the Treasury maintains that Kenya’s economic outlook remains stable, supported by the $30 billion budget for the 2024/2025 financial year, which projects 5.5 percent growth. However, analysts warn that sustaining this momentum will require renewed dialogue on revenue policy, reforms in public spending, and measures to rebuild public trust. For now, the latest funding release offers ministries breathing room as the government works to realign its fiscal strategy.