Nairobi, Kenya – For many Kenyans, the promise of accessible and quality healthcare is increasingly distant, overshadowed by the nation's burgeoning public debt. A significant portion of government revenue is now consumed by debt servicing, leaving vital sectors like health underfunded and struggling to meet the needs of a growing population.

As of May 2025, Kenya's public debt reached KSh 11.5 trillion, marking a 10.3% increase from the previous year. External lenders hold nearly half of Kenya's total financial obligations. The cost of servicing this debt is substantial, with approximately KSh 1.448 trillion spent between July 2024 and May 2025, representing nearly 70% of the total government revenue. This prioritisation of debt repayment over essential services has profound implications for the health sector.

Historical and Political Context

Kenya's public debt has been a subject of increasing debate since 2014, following the flotation of its first Sovereign bond and loans for major infrastructure projects like the Standard Gauge Railway (SGR). The debt-to-GDP ratio has steadily climbed, reaching 67.4% as of December 2024, significantly exceeding the International Monetary Fund's (IMF) recommended threshold of 50% for developing countries. This upward trend in debt service expenditure has been consistent since the 2014/2015 financial year.

The Kenyan Constitution of 2010 guarantees every person the right to the highest attainable standard of health. This commitment is also reflected in Vision 2030, the country's long-term development blueprint, which aims for a healthy and productive population. However, the increasing debt burden directly undermines these constitutional and developmental aspirations.

Laws, Policy, and Governance

Despite the government's stated commitment to Universal Health Coverage (UHC), a flagship initiative, the allocation to the health sector remains significantly below international recommendations. In the 2025/2026 budget, KSh 138.1 billion was allocated to health, an 8.7% increase from the previous year. However, this constitutes only 3.3% of the national budget, a stark contrast to the 15% target set by the Abuja Declaration, which Kenya ratified in 2001. The combined national and county health budget for FY 2023/24 was KSh 280 billion, representing 9.7% of the total government budget, still short of the Abuja target.

Recent legislative efforts, including the Social Health Authority Act (2023), Digital Health Act (2023), Primary Healthcare Act (2023), and Facility Improvement Fund Act (2024), aim to strengthen the legal framework for UHC. However, the effectiveness of these laws is hampered by inadequate funding and systemic challenges.

Stakeholders and Testimonies

Healthcare workers face immense pressure due to understaffing and inadequate equipment. Reports indicate that patients with severe conditions like cancer, kidney disease, and sickle cell anaemia struggle to access care without direct payment. This forces families to resort to social media fundraising for medical expenses. Women and girls are disproportionately affected by cuts to public healthcare, often leading to home births and limited access to essential services.

A 2025 Afrobarometer survey revealed that 61% of Kenyans lack any medical aid coverage, with 59% citing affordability as the primary reason. Furthermore, 78% of Kenyans worry about being unable to afford or obtain necessary medical care for their families. Nearly two-thirds (63%) of those who sought care at public health facilities reported difficulty in obtaining services.

Evidence and Data

Kenya's health expenditure per capita was $90.44 in 2022, a decline from $94.11 in 2021. This figure is significantly lower than the world average of $1324.86. Out-of-pocket payments constitute a substantial portion of healthcare costs, with Kenyans spending approximately KSh 150 billion annually. This high out-of-pocket expenditure pushes an estimated 2.6 million poor people into poverty.

A study investigating the effect of external public debt on health status in Kenya found a statistically significant negative correlation. A one percentage point increase in external debt relative to GDP was associated with a 0.5512 percentage point rise in morbidity (health burden) in the long run.

Risks and Implications

The current trajectory of debt accumulation and servicing poses significant risks to Kenya's social and economic development. The diversion of funds from health and education creates a 'crowding out effect,' hindering progress towards UHC and other Sustainable Development Goals (SDGs). The World Bank's International Debt Report ranked Kenya fourth globally for high-interest payments on external debt as a share of export earnings in 2023, with interest payments consuming 12.8% of its export earnings. This unsustainable debt burden weakens fiscal positions and diverts resources from essential services.

Unknowns and Controversies

While the impact of debt on healthcare is evident, the specific mechanisms and the full extent of its long-term consequences require further in-depth research. The effectiveness of recently enacted health laws in mitigating these challenges amidst fiscal constraints remains to be seen. There are ongoing debates regarding the optimal balance between infrastructure development financed by external debt and investment in social services.

Timeline and Next Steps

The government's commitment to UHC by 2030, as part of the Sustainable Development Goals, faces considerable hurdles. The 2025/2026 budget, while showing an increase in health allocation, still falls short of the Abuja Declaration target. Analysts continue to urge clarity on timelines, costs, and safeguards for policy execution.

What to Watch

Observers will be closely watching the implementation of the Social Health Authority and its ability to expand health insurance coverage and reduce out-of-pocket expenses. The government's strategies for debt management and fiscal consolidation will be critical in determining the future of healthcare funding. Any adjustments to the national budget and their impact on social sector allocations will also be key indicators.

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