For years, the national budget process in Kenya was a dull, technical affair, largely unnoticed by the public. But 2024 marked a turning point. The Gen Z-led protests transformed the Finance Bill from a closed-door parliamentary event into a national debate, putting unprecedented scrutiny on the government’s fiscal plans.
The Ruto Budget Doctrine: More Taxes, More Outrage
When President William Ruto took office in September 2022, he inherited a troubled economy. Post-COVID-19 shocks, high food and fuel prices, an underperforming manufacturing sector, and ballooning debt defined the landscape. His administration’s response was to swiftly dismantle subsidies and introduce a raft of new taxes from increased fuel levies to new income tax bands and service fees. The controversial overhaul of NHIF into the costly Social Health Insurance Fund (SHIF) and a disputed housing levy only deepened public frustration.
Ruto justified these measures as necessary to meet debt obligations. But to many Kenyans, it felt like an assault on their livelihoods a feeling that culminated in the dramatic rejection of the 2024 Finance Bill.
Finance Bill 2024: The Spark of a Movement
The 2023/2024 budget was the calm before the storm. Despite opposition resistance and limited public protests, the government steamrolled through with new taxes. However, in 2024, the situation exploded.
The Finance Bill 2024 became a rallying point for disaffected youth, culminating in historic protests that peaked on June 25, when demonstrators stormed Parliament. The next day, Ruto bowed to public pressure and withdrew the bill a move never before seen in Kenya’s legislative history.
The Irony of Power: John Mbadi’s Appointment
Among the government’s harshest critics was ODM Chairman and nominated MP John Mbadi. In October 2023, he condemned the 2023 Finance Act, stating that increasing taxes would stifle economic growth. He advocated instead for stimulating domestic demand and widening the tax base.
But in a dramatic twist, following the protests, Ruto disbanded his Cabinet and announced a “broad-based government.” On July 24, 2024, John Mbadi was named Cabinet Secretary for the National Treasury now tasked with crafting the very policies he once denounced.
Finance Bill 2025: Mbadi’s High-Stakes Test
Mbadi’s first budget presentation in June 2025 will be closely watched. With public trust in tatters and a fragile economy, he faces immense pressure to balance fiscal responsibility with social empathy.
In February 2025, Mbadi assured the public there would be no new taxes in the 2025 Finance Bill. Speaking at a Bunge La Mwananchi forum, he emphasized alternative revenue strategies expanding the tax base, enforcing fiscal discipline, and reforming tax collection processes.
A Budget with No Room to Breathe
The 2025 Budget Policy Statement outlines an ambitious target for KRA: Ksh.3.018 trillion, a 14.7% increase from the previous year. However, critics say this is unrealistic given past revenue shortfalls and sluggish economic recovery.
The proposed total budget of Ksh.4.2 trillion leaves a projected fiscal deficit of Ksh.814 billion (4.3% of GDP). With limited borrowing space, the temptation to introduce new taxes remains — a politically dangerous path.
Moreover, Kenya’s debt strategy relies heavily on domestic borrowing (65%), which risks crowding out the private sector and strangling economic growth.
Zero-Based Budgeting: The Double-Edged Sword
The Treasury is pushing a Zero-Based Budgeting (ZBB) model to ensure every expenditure is justified from scratch. While this promises efficiency, critics argue Kenya’s debt and political landscape may not support such a resource-intensive approach.
MP Mark Nyamita argued that ZBB, though idealistic, could face resistance and implementation challenges in the current fiscal climate.
The Bigger Picture: Restoring Trust and Participation
Kenya’s Constitution enshrines public participation in governance. However, a 2023 study found that public participation often becomes a formality a checklist rather than a genuine engagement.
As the country prepares for Finance Bill 2025, there is a renewed call for a legal framework that defines and enforces meaningful public participation. Without this, the government risks further alienating a public that now demands a say in how taxes are levied and spent.
Kirinyaga Woman Rep Njeri Maina summed it up: “The government is borrowing, but taxpayers are not seeing a return on investment. Public participation appears to be a PR agenda.”
The Road Ahead for Mbadi and the Treasury
As Mbadi prepares to table his first Finance Bill, he carries not just the weight of numbers but of expectations. Can he champion reforms without reverting to punitive taxes? Can he deliver a budget that inspires confidence rather than rebellion?
The Finance Bill 2025 may well define the next chapter of Kenya’s fiscal history — and John Mbadi’s legacy.
