Treasury Clarifies Reports Of Withdrawing Ksh1.3 Trillion Over 7 Months

The National Treasury has clarified a section of media reports suggesting irregularities in exchequer withdrawals, particularly claims of a Ksh1.3 trillion withdrawal over seven months. 

In a statement on Sunday, March 2, Chris Kiptoo, the Principal Secretary, debunked the claims, stating that until the end of the 2023/24 financial year, exchequer requests and withdrawals were processed manually, as the system had not yet been automated. 

However, Kiptoo noted that all withdrawals followed strict legal and financial procedures, with every transaction subject to review and approval by the Controller of Budget, ensuring full compliance with public finance regulations.

National Treasury Principal Secretary Chris Kiptoo during a press briefing on February 13, 2025. /NATIONAL TREASURY

"On 1st July 2024, the National Treasury, in collaboration with the Central Bank of Kenya (CBK) and the Controller of Budget (COB), launched a major reform initiative to automate the Exchequer process. This initiative is designed to enhance efficiency, reduce processing time, improve accountability, and strengthen financial oversight," the statement read in part.

The PS added that as part of this reform, all National Government Ministries, Departments, and Agencies (MDAs) have been successfully onboarded onto the automated system, ensuring that exchequer requests and approvals by the CoB are now processed digitally. 

However, certain transactions- including debt payments, transfers to counties, the Judiciary Fund, and the Equalisation Fund- were not included in the first phase of automation due to their distinct approval processes. 

PS Kiptoo revealed that the integration of these transactions into the automated system is currently underway, with full automation expected by the end of the 2024/25 financial year.

"The National Treasury categorically affirms that all Exchequer withdrawals, whether processed manually or electronically, are subject to strict legal and financial oversight. Every transaction undergoes due diligence and approval by the Controller of Budget, ensuring full compliance with public finance regulations. At no point has public money been lost or misappropriated through this process," the PS dismissed the claims.

Despite this, PS Kiptoo assured that once the Treasury receives the official report from the Controller of Budget, a comprehensive response will be provided to address any further concerns.

A Daily Nation exclusive on February 2 revealed that both governments manually requested over Ksh1.3 trillion for debt payments, pensions, and other expenses, bypassing the automated system.

The report stated that this information came from a confidential Controller of Budget (CoB) report submitted to the National Assembly Committee on Finance and National Planning.

Allegedly, these transactions took place between July 12, 2024, and February 2025.