Hard truths. Bold Insights. Real talk.
The allocations were published in a gazette notice dated February 6, 2026, where National Treasury Cabinet Secretary John Mbadi confirmed that the financing is sourced from the International Development Association-World Bank credit and will be directed to selected urban centres across the country.
Mbadi said that mass demonstrations not only slow down business operations but also limit the government’s revenue collection, forcing it to borrow more at higher interest rates.
Treasury Cabinet Secretary John Mbadi said the proposal includes increasing funding to the Higher Education Loans Board from the current Sh41 billion to Sh58 billion, alongside a sharp rise in scholarship funding.
The move targets salaried Kenyans as part of efforts to revive spending and reduce pressure caused by the rising cost of living.
The LAPF Board oversees the management of pension and provident funds for employees of local authorities. Appointments and changes to the board fall under the National Treasury’s mandate and are formalized through the Kenya Gazette.
The Treasury CS told lawmakers to explore ways of keeping the fund alive, including redesigning it, developing alternative structures, or anchoring it firmly in the Constitution. He said channeling resources directly to communities remains a priority for him and described the fund as essential rather than optional.
Kenya borrowed Sh655 billion ($5.08 billion) from the China Export-Import Bank in the year ending June 2015 for the SGR project, covering the Mombasa-Nairobi section and the subsequent line to Naivasha. Since then, the country has been servicing the loans by paying interest twice annually, in January and July, with the initial maturity ranging between January 2029 and July 2035.
Addressing government officials during the 2026/27 public sector budget hearings on Wednesday, Mbadi said the country’s progress in stabilizing its finances should encourage officials to be more deliberate in how they plan and spend. He noted that the economy can only remain steady if public institutions show responsibility in managing funds.
The Banking (Penalties) Regulations, 2025, are now under review by the Parliamentary Committee on Delegated Legislation, as lawmakers prepare to scrutinise their potential impact on the financial sector.