Controller of Budget flags record Ksh.209B unbudgeted Gov't spending

The Office of the Controller of Budget (CoB) has raised the alarm yet again over the use of Article 223 by government bodies.

According to CoB Dr. Margaret Nyakang’o, in the 2025/2026 financial year, the government used Article 223, which allows urgent, unforeseen expenditure not previously appropriated, to spend a total of Ksh.209.37 billion, the highest expenditure recorded under the constitutional provision.

The Nyakang’o-led team is now calling for further fiscal consolidation, noting that despite the Treasury’s commitment to cutting spending, little progress is evident.

In the 2025/2026 financial year, a record Ksh.209.37 billion was approved by the Office of the Controller of Budget, comprising Ksh.21.47 billion for development expenditure and Ksh.187.90 billion for recurrent expenditure.

This represents the highest use of Article 223 of the Constitution over the past four years.

In the 2022/2023 financial year, the Treasury approved Ksh.103.68 billion under Article 223, but only Ksh.69.2 billion was disbursed.

In the following financial year, 2023/2024, Ksh.65.4 billion was approved, but only Ksh.19.2 billion was spent.

In the 2024/2025 financial year, Ksh.72.24 billion was approved, of which Ksh.66.56 billion was utilised.

“Our concern is that some of them are related to day-to-day operations, so our concern was the rising use rather than the increase, as well as the nature of some of the operations that were being funded,” said Stephen Otieno, Assistant Director of Budget Implementation.

Nyakang’o questioned why requests under Article 223 were becoming increasingly frequent, noting that some government entities resort to the provision after failing to secure funding for items they had initially budgeted for.

“What we should be asking is why it's getting more and more frequent. One of the reasons we cannot ignore, and that most of these entities raise, is that they tried to budget for these items but they were not given the funds. Later, they find that they cannot operate without the funds, so they now come through the door of Article 223,” Nyakang’o said.

The Controller of Budget also raised concerns over the growing number of county investment conferences organised to attract investors through county investment bodies, which she says operate outside the existing legal framework.

“These investment bodies are not legal entities. They are not allowed; they are not in the PFM Act. But counties have been allowed to come together and attract investors to their regions. That is fine, but it's not in the PFM Act. You can't find it anywhere, and so they don't even report on these investment forums,” Nyakang’o said.

The concerns extend to Parliamentary expenditure, which the Controller of Budget says remains difficult to scrutinise beyond the allocations and reports submitted to the office.

This limited visibility makes it difficult for the watchdog to establish how the National Assembly utilises its annual allocations from the Exchequer.

“From the CoB's point of view, we cannot really go further than taking it as other expenses. The Auditor-General is allowed to dive in and find out, of these other expenses, what they are all about. So, to answer you, we don't have visibility beyond the budgetary limits and what has been reported to us,” Nyakang’o remarked.