President William Ruto during a past Cabinet meeting. | @WilliamsRuto/X
The Cabinet on 10 February 2026 approved the Budget Policy Statement for the 2026/27 financial year in a meeting chaired by President William Ruto. The plan projects total revenues of KSh3.53 trillion against an overall expenditure ceiling of KSh4.7 trillion, marking a shift toward increased investment and implementation of the Bottom-Up Economic Transformation Agenda.
Under the Division of Revenue Bill, 2026, county governments are set to receive KSh420 billion as their equitable share, representing 21.9 per cent of the most recent audited revenue, alongside KSh15.2 billion for the Equalisation Fund. An additional KSh75.7 billion has been proposed through the County Governments Additional Allocation Bill, bringing total county transfers to KSh495.7 billion.
Expenditure allocations in the budget include KSh3.46 trillion for recurrent spending, KSh749.5 billion for development, and KSh2 billion for the Contingency Fund.
The Cabinet says the macroeconomic outlook remains positive, with GDP growth projected to reach 5 per cent in 2025 and 5.3 per cent in 2026, underpinned by favourable weather, stronger agricultural output, and ongoing economic reforms.
Next, the 2026 Budget Policy Statement will be submitted to Parliament to guide the formal national budget process and approval before the new fiscal year begins.
