Every time floods wash away roads, drought decimates livestock or disease outbreaks strike, Kenya spends billions of shillings responding to the crisis.
But where does that money come from? The bulk of it has come after disasters have already struck, through emergency budget reallocations, supplementary budgets, donor appeals and humanitarian assistance.
The National Treasury is planning to change that model going forward. Through Disaster Risk Financing Strategy 2026-2030, it promises a policy shift from reacting to disasters to preparing financially before they happen.
The strategy affects not just mandarins at the Treasury, but every Kenyan taxpayer because disasters are increasingly threatening economic growth, public services and national development.
Here are the key questions and answers you need to know about the new approach.
Why is Kenya changing how it handles disasters?
Because disasters are becoming more frequent, more expensive and more complex.
Kenya is no longer dealing only with recurring droughts. The country increasingly faces severe floods, disease outbreaks, landslides, pest invasions, fires, building collapses and even technological and security-related disasters.
The Treasury estimates that more than 30 percent of Kenya’s economy and over 40 percent of employment depend on sectors highly exposed to these risks, particularly agriculture.
Recent disasters have exposed how vulnerable the economy has become.Covid-19 scourge, desert locust invasion and prolonged drought pushed economic growth down from five percent in 2019 to a measly 0.3 percent in 2020. The devastating floods of 2023 and 2024 then caused losses, which Treasury has estimated Sh187.82 billion.
How does Kenya pay for disasters?
When disaster strikes, the Treasury, through the National Assembly, often shifts money from other programmes, approves supplementary budgets or appeals for donor support.
Through the strategy, the Treasury acknowledges this reactive approach creates several problems.
This is because emergency funding often arrives too late, money is usually insufficient and development projects are delayed because allocated cash is diverted.
In the strategy, the Treasury says Kenya’s financing has remained heavily dependent on post-disaster budget reallocations and humanitarian assistance instead of predictable financing arranged in advance.
So what is changing in the strategy?
Instead of asking where money will come from after disaster strikes, the Treasury wants to arrange that financing before they occur. This is called pre-arranged disaster financing.
Under this approach, funding mechanisms will be in place before floods, droughts and other epidemics occur. And once agreed conditions are met, money can be released immediately instead of waiting for lengthy government approvals. The goal is quicker response, fewer losses and less disruption to the economy.
Why does speed matter so much?
Delays in managing or mitigating major disasters only make them more expensive. For example, a drought that receives livestock support early may prevent massive animal deaths, flood victims who receive immediate assistance recover faster, while roads repaired quickly allow businesses to resume operations sooner.
The Treasury argues that early financing reduces both humanitarian suffering and the eventual financial cost to government.
Why is it important to invest before instead of after disasters?
Perhaps, the main reason is that prevention costs less than rebuilding.
Rather than spending billions of shillings replacing destroyed infrastructure, the Treasury wants greater investment in flood control, resilient roads, early warning systems, climate adaptation and preparedness programmes.
It notes in the strategy that Kenya still lacks a fully costed national investment plan for disaster prevention, even though adaptation financing requirements alone run into tens of billions of dollars.
Why is Kenya planning to rely less and less on donors in times of disaster?
Global aid is shrinking. The Treasury, for example, notes that Official Development Assistance fell by more than 23 percent in 2025 alone, with further declines expected.
Kenya, at the same time, faces growing public debt, limiting its ability to borrow every time disaster strikes. That means future disaster financing must increasingly come from stronger domestic systems and greater private-sector participation.
Doesn’t Kenya already have several disaster funds?
Yes, Kenya operates several financing mechanisms, including the Contingencies Fund, the National Drought Emergency Fund, County Emergency Funds, the Hunger Safety Net Programme and agricultural insurance schemes.
However, most were designed primarily around drought.
The Treasury says financing for floods, epidemics, landslides, fires and other hazards remains inadequate. Some important financing tools used previously have also become inactive, leaving gaps in protection against large disasters.
What role will counties play under the planned disaster financing framework?
Kenya’s 47 counties are expected to strengthen emergency funds, improve preparedness and work more closely with the National Treasury under common financing rules.
The strategy also seeks better coordination between national and county governments so funding can move faster during emergencies.
How will the taxpayers– benefit?
The Treasury says the objective is not simply to spend more money, but spend it earlier and more effectively.
If financing works as planned, disaster victims should receive assistance faster, enabling affected communities to recover more quickly.
Furthermore, essential public services such as education and healthcare should face fewer disruptions, while development projects should be less likely to lose funding whenever disasters occur. Over time, this should reduce the overall economic shocks caused by disasters.
What are the biggest challenges?
The strategy itself acknowledges that implementation will determine whether the reforms succeed.
Kenya still faces gaps in disaster data, coordination between institutions, county preparedness and long-term investment in prevention.
The country must also identify new sources of financing at a time of rising public debt burden and declining donor support.