The State Department for Lands and Physical Planning has sought Parliament’s approval for an additional Sh3 billion in the 2025/26 Supplementary Estimates No.1 to fund the settlement of landless Kenyans, as it grapples with budgetary pressures and declining revenue collections.
Appearing before the National Assembly Committee on Lands on March 17, 2026, Principal Secretary Nixon Korir said the revised budget has increased significantly from Sh10.76 billion to Sh13.31 billion, largely driven by the need to scale up development expenditure.
Korir told lawmakers that the request is anchored on two key priorities: the settlement of the landless and a shortfall in personnel emoluments.
“The State Department requested the National Treasury for additional funding amounting to Sh3 billion to enable the purchase of land approved by the Land Settlement Fund Board of Trustees for the settlement of the landless,” he said.
The PS highlighted the magnitude of the challenge facing the department, noting that available resources fall far below demand.
“Our requirements for the settlement of the landless exceed Sh50 billion, which is far beyond what is allocated annually to the State Department,” he said.
Korir revealed that the government is currently engaging landowners in negotiations to make the programme more affordable and sustainable.
“You recall that during our presentation of the Budget Policy Statement (BPS) 2026, I briefed this committee on the ongoing negotiations with landowners of parcels that have been invaded by squatters. The State Department has engaged the landowners on the need to review their offer prices downwards,” Korir said.
He added that the talks are already bearing fruit and could accelerate resettlement efforts.
“I want to report that we are making good progress and many landowners are accepting our terms, which will speed up the settlement process,” he said, urging MPs to back the funding request.
In addition to the Sh3 billion request, the department is also seeking Sh196 million to plug a deficit in staff compensation.
“Following a thorough review of our personnel emoluments allocation and requirements up to June 30, 2026, the State Department requires an additional Sh196 million to cater for the deficit in personnel emoluments,” Korir said.
The supplementary budget also includes a realignment of development expenditure to address a funding gap in the Kedong Ranch land payment. The PS disclosed that while the department had been allocated Sh1.523 billion for the project, it requires Sh1.723 billion annually, necessitating internal adjustments approved by the National Treasury.
However, the department’s financial plans have been complicated by underperformance in Appropriations-in-Aid (AIA) revenue, forcing cuts across several programmes. Projects such as the digitisation of land registries and the construction and renovation of land offices have been scaled down.
Korir told MPs that revenue collection had fallen short of expectations in the first half of the financial year.
“Revenue performance in the first half of FY 2025/2026, especially on AIA revenue collections, was below our projections,” he said.
He noted that the department had initially projected to collect Sh4.005 billion, but had only raised Sh1.543 billion by December 2025, missing its half-year target. As a result, the State Department is proposing further downward revisions.
“We are therefore proposing that this committee consider a further downward revision of Sh200 million, which will bring the total proposed AIA reduction to Sh850 million,” Korir said.
Despite the fiscal constraints, the PS maintained that the additional funding would have a direct impact on service delivery. He projected that the number of landless households settled would increase from 14,000 to 16,000 if Parliament approves the request.
At the same time, some targets have been revised downward due to budget cuts, including the digitisation of land registries and the construction of land offices.
Korir also clarified that the department did not utilise emergency spending provisions during the period under review.
“The State Department did not request to spend any additional funding under Article 223 of the Constitution in FY 2025/26. Therefore, there was no withdrawal or expenditure under this provision,” he said.
Parliament is now expected to scrutinise the proposals as part of the Supplementary Estimates process before making a final determination on the additional funding requests.
