Hard truths. Bold Insights. Real talk.
Appearing before the National Assembly Committee on Public Debt and Privatization, Kenya Airways chief executive officer Allan Kilavuka gave a detailed account of how the 2012 expansion plan aimed at transforming the airline into Africa’s leading carrier by 2021 turned into one of the country’s most costly corporate failures.
The National Assembly’s Committee on Sports and Culture flagged the financing plan, intended to support one of the main venues for the 2027 Africa Cup of Nations, for lacking transparency and sufficient public consultation.
The Digital Debt Automation System will gather all loans from both national and county governments into a single platform.
Alongside unpaid debts, hospitals were also flagged for weak revenue collection systems. The Auditor-General found that 223 hospitals failed to collect Sh11.35 billion in revenue during the year.
Domestic lenders accounted for the bulk of debt service in the year under review. Of the Sh1.7 trillion spent on public debt, Sh992.4 billion went to domestic creditors, with interest payments forming the largest share.
The Auditor-General’s report shows uncollected taxes have surged to Sh2.3 trillion, more than double the Sh999.6 billion reported last year.
Speaking during the devolution conference in Homa Bay, Mbadi said the arrears had risen sharply from Sh23.3 billion in recent years to over Sh103 billion, describing the situation as deeply worrying.
The audit further revealed that six universities recorded operating deficits totaling Sh3.2 billion, meaning their expenditures exceeded revenue.
A significant portion, Sh2.7 billion, is linked to legal fees owed to at least a dozen law firms, while the rest includes Sh360 million for logistics, mostly owed to the Postal Corporation of Kenya, and Sh920 million under other miscellaneous claims.
The National Assembly’s Debt and Privatisation Committee, in a report on the Consolidated Fund Services (CFS) budget under Supplementary Budget III, noted that the absence of such a policy has hindered Kenya’s ability to take advantage of key tools like prepayments, debt swaps, and restructuring.
PS Beatrice Inyangala urged institutions to reform their structures and adopt sustainable financial practices.
Treasury Cabinet Secretary John Mbadi on Thursday said the State is banking on PPPs to deliver 32 projects that include the construction of electricity transmission lines, dams, and roads.