The National Government Budget Implementation Review Report by the Office of the Controller of Budget has revealed that the national government's pending bills reached Ksh525.44 billion by the end of September 2025, with parastatals making up approximately 77 per cent of the total debt.
The report, covering the first three months of the 2025/2026 financial year, highlighted a systemic failure in debt management, with state-owned enterprises emerging as the primary drivers of the unpaid obligations.
According to the Controller of Budget, Dr Margaret Nyakang'o, the total outstanding balance is split between two main categories: State Corporations (parastatals) and Ministries, Departments, and Agencies (MDAs).
State Corporations and Semi-Autonomous Government Agencies (SAGAs) owe a combined Ksh406.49 billion.
Of this amount, Ksh210.64 billion is attributed to recurrent expenditure, such as salaries and administrative costs, while Ksh195.9 billion is linked to stalled or ongoing development projects.
Ministries, Departments, and Agencies (MDAs) account for the remaining 23 per cent of the pending bills, totalling Ksh118.94 billion.
The MDAs' debt is also split between recurrent obligations amounting to Ksh76.33 billion and development-related payables of Ksh42.60 billion.
The report identifies that the National Police Service has accumulated Ksh13.65 billion in trade payables, while the State Department for Correctional Services owes Ksh6.22 billion.
The Executive Office of the President, through the defunct Nairobi Metropolitan Service (NMS) and its headquarters, carries a combined debt of over Ksh13.6 billion.
The Controller of Budget has expressed concern that the continued delay in payments is not just a bookkeeping issue but a threat to the broader economy.
Nyakang'o has recommended a shift towards more disciplined financial management.
This includes the strict prioritisation of essential services and ensuring that all procurement plans are uploaded into the Integrated Financial Management Information System (IFMIS) to track commitments in real time.
