This memorandum is based on input from 270 participants who took part in a public virtual forum held via Zoom on 15 May 2025. Participants represented 70 national and county-based organizations across 30 counties in Kenya.
The FY 2025/26 budget is being developed against a backdrop of global economic slowdown and shifting donor funding landscapes. Notably, the US Government’s stop work order, the absence of an IMF programme, and new World Bank requirements on the Development Policy Operation IV (DPO IV) have complicated fiscal planning. Although the government plans to reduce the budget deficit, it remains significantly high.
Revenue collection has encountered challenges during the current financial year. To address this, the government aims to improve revenue collection while rationalising expenditure to achieve fiscal consolidation over the medium term.
However, these fiscal measures are set against a context of rising living costs, which continue to impact vulnerable citizens. Balancing proposed revenue targets with the socioeconomic realities of the population is a critical concern. The budget seeks to respond to these challenges by focusing on prudent financial management while ensuring socio-economic protection for those most affected by economic pressures.
