National Treasury Principal Secretary Chris Kiptoo has revealed the country's financial challenges, saying more than half of national revenue goes to servicing debts.
The PS said the country must find a way of not only slowing down on borrowing but also cutting down on costs as part of the fiscal consolidation measures.
"For every Sh10 we get from KRA, we use Sh6 to pay debt. This means that we have less money to fund roads, education and other areas of development. This is the reality,'' Kiptoo said.
The PS was speaking during a pre-budget reading media briefing on Thursday at the National Treasury Building.
He said the reality is that the country's low revenue levels are forcing the government to borrow more to address the deficit.
"Continuing widening of deficit means we are taking more debts and taking more revenues in future and that means shrinking amount of money that can be used to fund roads, education and development,'' the PS said.
Kiptoo said when the government is using more of its revenue on meeting recurrent expenditure, the impact of development would not be much in all sectors.
"We must really live within our means, there is no room for blame, the reality is that this is where we are because we have taken more than we can afford,'' he said.
"We are saying let's reduce over the medium term through a fiscal consolidation, we may wish to run a balanced budget but we can't do that at once,'' he said.
National Treasury Cabinet Secretary Njuguna Ndung'u will on Thursday afternoon read the 2024/25 budget estimates during a joint sitting of the Senate and National Assembly.