Thursday 10th September, 2026 10:19 PM|
Treasury Cabinet Secretary John Mbadi says Kenya will increase health spending by an additional Ksh115 billion over four years as African countries move towards greater domestic financing amid declining external support.
Mbadi said the shift would require governments to take greater ownership of their health systems and strengthen domestic capacity to sustain healthcare programmes.
Speaking in Nairobi on Thursday, September 10, 2026, during a High-Level Finance Ministers’ Policy Dialogue convened by the US Embassy, Mbadi said the move towards domestic financing was no longer optional.
“The transition is not a policy preference. It is a fiscal necessity,” he said.
The dialogue, titled “Strengthening Country Led Health Financing and Advancing Shared Commitments for Co-Investments in Health,” brought together finance leaders to discuss how countries can sustain health programmes as external support declines.
Kenya’s health spending plan
Mbadi said Kenya’s health allocation of about Ksh170.7 billion in the 2026/27 financial year demonstrated the government’s continued investment in the sector.
Under the Kenya-US Health Cooperation Framework, Washington is expected to provide up to about US$1.6 billion in support over five years, while Kenya increases its domestic contribution.
The agreed pathway will see Kenya raise health spending by Ksh10 billion in 2026/27, Ksh20 billion in 2027/28, Ksh35 billion in 2028/29 and Ksh50 billion in 2029/30.
The increases amount to Ksh115 billion by the end of the four-year period.
Mbadi said the framework should be viewed as a managed transition towards greater country ownership rather than simply replacing external funding with domestic resources.
“The objective is not simply to replace external dollars with domestic dollars, but to use the transition period to strengthen institutions, systems, supply chains and domestic capacity so that Kenya can increasingly sustain its health programmes,” he said.
Focus on health systems
Mbadi said the government was progressively increasing domestic resources while working to improve efficiency, accountability and value for money in the health sector.
He cited efforts to strengthen the Social Health Authority, expand primary and preventive healthcare, improve procurement and supply chains and reinforce national and county health systems.
The government is also seeking to expand local manufacturing of pharmaceuticals, vaccines and other health products.
Mbadi said sustainable health financing would require stronger domestic revenue mobilisation, better expenditure prioritisation and reduced wastage.
He also called for stronger social health insurance mechanisms and continued mobilisation of development partner resources during the transition.
Push for private capital
Mbadi said public resources alone would not meet Africa’s growing health investment needs, calling for greater private sector participation across the industry.
He identified pharmaceuticals and vaccine manufacturing, diagnostics, health infrastructure, digital health, medical technologies, supply chains, research and innovation as areas where private capital could play a greater role.
Public-private partnerships, blended finance, guarantees, results-based financing and impact investment, he said, could help reduce investment risks and attract additional capital into healthcare.
“We should increasingly view the private sector not only as a service provider, but also as a source of capital, technology, innovation and efficiency,” Mbadi said.
He said Kenya could expand private primary and secondary healthcare facilities, specialised care, local pharmaceutical manufacturing, innovative insurance products and digital health solutions.
Mbadi added that the government was also using tax policy to reduce the cost of healthcare and insurance while encouraging investment in health infrastructure and local pharmaceutical manufacturing.
