THE Controller of Budget Margaret Nyakang’o has said the country needs to prudently manage its debt and institute revenue collection reforms.
Allocation towards servicing the public debt in the financial year 2024-2025 is set at Sh1.91 trillion, compared to Sh1.87 trillion in 2023- 2024, with the country’s average time to maturity for public debt reducing to 7.8 years, down from 9.4 years in 2023.
The allocation comprised Sh809.57 billion for principal and Sh1.01 trillion for interest payments.Allocation towards external debt comprised of Sh330.71 billion for principal and Sh259.91 billion for interest, while domestic debt comprised Sh569.89 billion and She749.97 billion towards principal redemption and interest payment, respectively.
In her report to the National Assembly Liaison Committee, to consider the medium-term debt management strategy for the 2025-26 financial year, Nyakang’o noted that the expenditure on public debt in the first six months of 2024-2025 financial year (July-December) amounted to Sh666.34 billion, compared to Sh597.58 billion in a similar period in 2023-2024.
The increase was mainly due to the settlement of domestic debt relating to treasury bills and bonds, which stood at Sh432.83 billion compared to Sh355.17 billion paid in a similar period previous year.
External debt servicing amounted to Sh231.29 billion, comprising
Sh129.60 billion on principal payment, Sh100.89 billion on interest
payment, Sh553.67 million on commitment fees, Sh977,540 on penalties
paid first, and Sh249.84 million on
other charges.
