Kenya is facing a mounting financial strain as billions of shillings in unpaid court awards pile up across government ministries and state agencies, leaving taxpayers exposed to rising costs.
Latest budget reports show that by December 2025, unpaid legal obligations stood at Sh233 billion, yet only Sh7.5 billion had been disbursed, highlighting a growing crisis in public financial management.
The health sector carries the heaviest burden, with nearly Sh100 billion in unsettled awards, some stemming from contracts dating back to President Daniel Moi’s era.
Among the largest claims is a Sh58 billion award to Equip Agencies, granted in 2011 after the government failed to pay for anti-malaria drugs and medical equipment supplied in the 1990s. Equip Agencies also holds another unpaid claim of Sh15 billion from 1999.
The Ministry of Health has also not paid Sh17 billion owed to United Medical Supplies for medical products, including throat swabs delivered between 1992 and 1993, with a large portion of the claim representing accumulated interest.
Agriculture follows as the second-largest sector with pending liabilities of Sh74.8 billion, of which the State Department for Agriculture accounts for Sh57 billion.
The department faces a Sh19 billion arbitration award linked to a dispute with M A Consulting Group. Another Sh4 billion remains unpaid to Halal Meat Products following a Supreme Court ruling. The original judgment of Sh1.8 billion in 2005 escalated to Sh5.2 billion due to extended litigation before being negotiated down to Sh4 billion, yet it is still unsettled.
The Lands Ministry has Sh12.9 billion in unpaid awards, with only Sh378 million cleared by December 2025. The National Police Service owes Sh1.9 billion from various court rulings, while the Interior Ministry has a separate claim of Sh1 billion.
The State Law Office is liable for Sh1.4 billion, including Sh270 million linked to a case involving Martha Karua, and Kwale Sugar is owed Sh70 million. The Ethics and Anti-Corruption Commission faces Sh65 million in awards, some pending due to ongoing appeals.
Political parties are also among claimants. ODM holds the largest share of a Sh5 billion award against the Office of the Registrar of Political Parties, with Sh4.9 billion still unpaid. PNU is owed Sh5 million, while the Independent Electoral and Boundaries Commission has pending suits totalling Sh436 million from rulings between 2013 and December 2025.
In the energy sector, the Kenya Electricity Transmission Company (Ketraco) owes Sh8.7 billion to a Spanish firm after terminating a contract, with no payments made so far, accounting for the majority of the sector’s Sh9 billion liability. Public administration agencies reported Sh7.7 billion in awards, including a Sh4.9 billion claim against the National Treasury over a data centre construction dispute in Nakuru.
“There is need to reconsider allocation of resources to the sub-sectors to address these obligations to adhere to the rule of law,” the Treasury report noted. Agencies in the social protection sector have Sh15.4 billion in outstanding awards.
Reports by Auditor General Nancy Gathungu and Controller of Budget Margaret Nyakang’o show that court awards are becoming a significant part of pending bills across both national and county governments. Treasury data indicates that while ministries are supposed to budget for legal liabilities, many still treat court decrees as contingent obligations, letting interest accumulate unchecked.
Parliament’s Public Accounts Committee has repeatedly criticized ministries and counties for weak legal risk management, poor defence in court, and delayed appeals, which allow interest to balloon while accounting officers rotate without facing personal accountability. MPs have questioned why government lawyers fail to negotiate settlements promptly, causing taxpayers to bear the growing financial burden.
