Controller of Budget warns against hawking loans as Ksh20.1B goes to undrawn funds
Controller of Budget Margaret Nyakang’o has warned that poor project planning is forcing Kenya to pay billions of shillings in commitment fees on loans that remain unused. Nyakang’o made the remarks on Tuesday, August 18, 2026, when she appeared before the National Assembly Public Debt and Privatisation Committee to discuss the cost of undrawn foreign […]
National Budget Controller Margaret Nyakang’o has highlighted the costly consequences of unused loans, warning that Kenya has paid Ksh20.066 billion in commitment fees over the past decade for undrawn loan facilities. The fees, which average Ksh1.824 billion annually, stem from poor project planning and weak coordination between the National Treasury and implementing agencies.
Nyakang’o criticized entities attempting to sell loans to the government prematurely, before sufficient assessment of their suitability. She called for the National Treasury to disclose the decision-making process behind borrowing and the governance structure involved. The Controller emphasized that the issue is linked to project delays and non-compliance with loan conditions, leading to continued taxpayer burden.
Parliament has previously raised concerns about signing loans before agencies are ready, urging stronger performance-based benchmarks and disbursement protocols. The undrawn loan problem persists, with Kenya receiving Ksh764.8 billion in external loans in 2025/26 but having Ksh1.277 trillion remaining undisbursed. Nyakang’o stressed the need for improved coordination between the Treasury and project agencies to prevent these financial losses, proposing tighter project-readiness checks and early-warning systems to identify at-risk loans.
Written by urgent.news from People Daily Kenya's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
