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Irungu Nyakera, the Farmers Party leader, has initiated a crucial dialogue about Kenya’s growing debt crisis, stating, “Let’s have an honest conversation about debt. The government has two main ways of raising funds – taxes and borrowings. When taxes don’t match expenditure, the government borrows.”
Nyakera pointed out that the situation in Kenya has been challenging, as the government has been borrowing to cover recurrent obligations, which contradicts the provisions of the Public Finance Management (PFM) Act. He revealed that a staggering 61% of all taxes collected are allocated to repaying loans, the majority of which were accrued under the previous administration.
For the fiscal year 2023/24, Nyakera highlighted that the government paid Ksh 631 billion in interest on domestic debt and Ksh 230 billion on external debt interest. Looking ahead, projections indicate that these payments will rise to Ksh 750 billion for domestic debt interest and Ksh 260 billion for external debt interest, which amounts to approximately Ksh 2.8 billion daily on interest payments alone.
Nyakera issued a stark warning to those who wish to challenge the president’s authority, asserting, “So to those that want to unconstitutionally take over from the president, imagining that all he does is sit at State House drinking tea all day, start figuring out how you will raise the Ksh 3 billion a day before you do any development work. Good luck.”
