Auditor-General Nancy Gathungu has presented a series of recommendations aimed at improving transparency, oversight, and sustainability in Kenya’s management of public debt.

Speaking before the National Assembly’s Public Petitions Committee, Gathungu responded to concerns raised by a petition highlighting the risks Kenya faces due to its growing debt burden. The petition calls for enhanced parliamentary scrutiny, public access to debt information, and consideration of the long-term impacts on future generations.

Key Proposals to Strengthen Debt Governance

  • Establishment of a comprehensive Public Debt Registry: Gathungu advocates for a centralized, publicly accessible database detailing all government loans, including creditor details, amounts, terms, repayment schedules, and project implementation status. She emphasized the registry should be backed by legislation and subject to regular audits and reporting.
  • Enhanced parliamentary oversight: The Auditor-General stresses the need for lawmakers to have better tools and information to scrutinize borrowing decisions and debt management practices effectively.
  • Independent technical analysis: Before approving significant loans, the government should require robust assessments such as debt sustainability analyses, fiscal risk evaluations, and feasibility studies to support evidence-based decision-making.
  • Accountability for debt utilization: Public institutions must not only confirm receipt of borrowed funds but also demonstrate that resources were used efficiently and delivered intended public benefits, supported by strengthened monitoring and evaluation frameworks.
  • Long-term debt sustainability measures: Recommendations include exploring cost-effective financing options, extending debt maturities, optimizing concessional borrowing, and deepening domestic debt markets.

Current Debt Situation

Gathungu highlighted that as of June 30, 2025, Kenya's public debt stood at Sh11.825 trillion, with a debt-to-GDP ratio of 67.8%, surpassing the government's target threshold of 55% set for 2028. Additionally, debt servicing consumes 66% of government revenue, severely limiting funds available for development and public services.

She warned that persistent fiscal imbalances continue to push debt levels higher, underscoring the urgent need for stronger governance mechanisms to safeguard Kenya’s economic future.

The Auditor-General’s recommendations are expected to influence parliamentary deliberations on improving debt management amid growing fiscal pressures and international concerns about Kenya’s debt sustainability.