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A third of Kenya’s budget stolen? We checked former senator’s claim about much-travelled corruption statistic

Have Kenyan government officials been claiming for more than 20 years that a third of the country’s budget is lost to corruption? And does Kenya collect more revenue than Uganda, Tanzania, Rwanda and Burundi combined? We took a look.

This article is more than 1 year old

  • The claim that a third of Kenya’s tax revenues will be stolen caused a furore when quoted by former president Uhuru Kenyatta in early 2021, but it can be traced back to 2003 in the Kenyan parliament and has been repeated frequently since then. 

  • Such a claim can’t be proven, though, because of the nature of graft – it happens in secret.

  • It is also correct that the tax revenue of Kenya, at US$14.4 billion in 2020, is just more than that of its neighbours Burundi, Rwanda, Tanzania and Uganda combined.

Kenyan president William Ruto has stepped up his government's campaign to increase tax revenues as he attempts to wean the country off expensive debt.

His plans include freezing tax exemptions and, more controversially, tracking mobile money transactions. 

These plans were contained in a draft budget policy statement released on 18 January 2023. Kenya’s national treasury released the final version of the policy statement on 15 February.

Speaking on NTV Kenya, Billow Kerrow, a former senator for Mandera county, the most northeastern in the country, criticised the widely debated tax measures.

Kerrow served as shadow finance minister from 2003 to 2007, and chaired the senate’s finance and budget committee from 2013 to 2017.

Tax should not be a burden on society, Kerrow said, according to a video clip of his comments posted online, including on Twitter and Facebook, and circulated on WhatsApp. 

In the widely shared clip, he also made two claims which we have vetted for accuracy.

Claim

“Kenyan officials have for the last 20 years claimed that one-third of revenues is going to be stolen.”

Verdict

Correct

In February 2021, then president Uhuru Kenyatta caused a furore when he said that more than KSh2 billion was being stolen from the public purse every day.

In his January 2023 interview, Kerrow referred to the scale of the theft, but also suggested that it wasn't a new allegation, despite the debate that Kenyatta's comments had sparked.

“People are suffering. People have no jobs. People have no income,” Kerrow said, alluding to a cost-of-living crisis in the country. 

He continued: “And you are allowing the government to collect taxes in a country where the government officially announces that a third of that revenue is going to be stolen, officially. For the last 20 years they have been announcing … KSh2 billion per day, the last president said.”

Has any government official made the claim that one third of Kenya's revenue was stolen? If so, has the claim been made for at least 20 years?

We dug into the archives. One of the earliest instances of the claim we found was in the Hansard, the official parliamentary record, dated 17 April 2003

The then minister for planning and national development, Prof Peter Anyang’ Nyong’o, said: “We know for certain that we have been losing about KSh68 billion through corruption and mismanagement. That is close to about a third of the national budget.”

In April 2003, the last quarter of the 2002/03 financial year, government revenue amounted to KSh205.7 billion. The KSh68 billion mentioned by the minister – without a source – is 33.1% or about a third of the revenue.

Nyong’o is the current governor of Kisumu county. 

We found other instances of the proportion being quoted:

  • 2010: Then permanent secretary in the ministry of finance, Joseph Kinyua, reportedly told a parliamentary committee in 2010 that the government would lose KSh270 billion out of a KSh1 trillion budget to corruption. This was picked up by the international media. 
  • 2016: Philip Kinisu, then chairperson of the Ethics and Anti-Corruption Commission, repeated the claim in an interview with the global wire news agency Reuters. “Kenya’s budget is now approaching KSh2 trillion; a third of it is being wasted through corruption,” he reportedly said
  • 2018: Then senator for Bungoma county, Moses Wetang’ula, said that “according to statistics from the government itself … in every annual budget, one-third is lost to corruption”. This “means that in a budget of KSh3 trillion, we are losing about a trillion to corruption through inflated procurement, outright theft, and misappropriation of funds”.
  • 2020: “The country loses about a third of the national budget through graft and corruption related activities” claimed a report by the European Commission’s Joint Research Centre and state research agency Kenya Institute of Public Policy Research and Analysis on the post-Covid recovery.
  • 2020: BNN Bloomberg, a Canadian partner of US business channel Bloomberg, quoted Kinyua, then head of the public service, as estimating that “that one-third of the nation’s annual budget is lost to graft”.   

The claim has been around for at least as long as Kerrow claimed, even if we could not establish if the proportion of a third adds up.

Corruption takes place in the shadows, says watchdog

Transparency International (TI) publishes the corruption perception index, which ranks countries’ efforts to fight graft. 

We asked the anti-corruption non-profit about the accuracy of this claim. 

“The closest you would get to official figures are the auditor general’s reports but the office gives figures on audit queries and not specifically on corruption, or losses,” Fidialice Wanjiru, a research executive at TI-Kenya, told Africa Check. 

Audit enquiries are requests for evidence of expenditure, often made by auditors when examining accounts to check that money has been spent on the intended goods or services and that the client has received value for money.

“The figures on how much [money] Kenya loses to corruption remain an estimate,” says Wanjiru. This is because corruption-related offences such as extortion, bribery, fraud, and theft or misuse of public funds often happen in secret.

Most of the figures quoted are from graft cases pending in court, she said.  

“The best way to get the actual figure would be through an analysis of anti-corruption cases which the state has won in court, with figures attached to them. But, as you may know, corruption cases are complex and take years to get convictions."

Claim

“The amount of revenue collected by the Kenya Revenue Authority is more than the amount of revenue collected by Uganda, Tanzania, Rwanda and Burundi combined.”

Verdict

Correct

The Kenya Revenue Authority (KRA) collects taxes for the government. To meet its latest target (of KSh4.8 trillion) it has pursued an aggressive tax collection strategy in recent months.

Kenya, Uganda, Tanzania, Rwanda and Burundi are part of the seven-nation East African Community (EAC).  The other members are South Sudan and the Democratic Republic of the Congo.

Kerrow dared “anyone in government” to challenge him on the accuracy of his figures. As a non-profit organisation Africa Check may not be in government, but we were still intrigued by the claim.

The World Bank has data on this. It cites the International Monetary Fund as its source.

The most recent data for Kenya, Uganda and Rwanda is from 2020. This shows the amount of revenue in local currency. 

The data from Burundi went back to 1999, so we tracked down tax revenue data for 2020 from the Burundi Revenue Authority

Similarly, we found data for Tanzania from the national tax agency

Kenya, Uganda and Tanzania all call their currency the shilling, but exchange it at different rates to each other and to the US dollar.

We converted each country’s revenue into dollars using their average 2020 exchange rate. We found that Kenya’s revenue in 2020 was $14.4 billion, while Burundi, Rwanda, Tanzania and Uganda together collected $14 billion. (See our calculations here.)

UploadKenya

Source: World Bank, Burundi Revenue Authority, Tanzania Revenue Authority

Therefore, we rate Kerrow’s claim correct.

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