A debt audit must lead to a credible plan for what comes next

An audit can reveal how a country reached a difficult debt position. It cannot, by itself, decide how the country should leave it. The harder work begins when findings must be turned into recovery proceedings, budget choices, negotiations and safeguards against repetition. Kenya needs to prepare that work while demanding the records, not improvise it after a report produces public anger.

The case for a rigorous debt audit remains strong. So does the case for refusing easy promises about what it will deliver. A report may expose serious misconduct without extinguishing the state’s repayment obligation. It may identify poor decisions for which prosecution is not the appropriate remedy. It may reveal that a disputed transaction was properly authorised and used. Each result requires a response proportionate to the evidence.

The task is to build a public plan with named institutions, realistic costs and a timetable. That plan should protect essential services while pursuing accountability. It should also explain where uncertainty remains. Citizens should not be asked to choose between unquestioning repayment and an undefined confrontation with every creditor. There are decisions between those extremes, and their consequences must be assessed carefully.

Match the remedy to the finding

A claim filed is not cash recovered.

Imagine an audit establishing that a contractor received payment for undelivered work. The immediate questions concern recovery, enforcement of the contract and the responsibility of the officials who approved payment. Whether the lender’s separate claim against the state changes is another question. Treating those two relationships as identical can produce a confident political announcement and a weak legal position.

Now imagine a project that was delivered but chosen on unrealistic assumptions. There may be lessons about appraisal, procurement or political interference. There may also be a useful asset that can be operated more effectively. A response focused exclusively on punishment could miss the opportunity to reduce losses or improve public value. Accountability should include repairing the decision process as well as identifying individual responsibility.

A third hypothetical case might raise serious questions about authority to borrow or the lender’s involvement in prohibited conduct. That would require specialist legal analysis of the agreement, applicable law and evidence. The available remedies cannot responsibly be announced from the label attached to the transaction. They have to be established through the relevant process.

The scholarly debate on odious debt is useful precisely because it confronts the gap between moral outrage and enforceable legal arguments. It should encourage Kenya to prepare transaction-specific cases. It should not be presented as an already binding international ruling that a new government can activate by declaration.

Recovery is valuable, but it is not instant revenue

The public should expect efforts to recover money where the evidence supports them. Those efforts need competent investigation, secure records and coordination between the institutions involved. They also need a realistic account of timing. A claim filed is not cash recovered. An order obtained may still require enforcement. A disputed asset may take time to locate and realise.

That distinction matters for the budget. It would be reckless to fund an immediate commitment using the full face value of hoped-for recoveries. A credible plan would separate amounts actually received from cases under way and estimates that remain uncertain. It would disclose legal and administrative costs so that the public can judge the net result.

Settlements may sometimes offer a quicker or less risky outcome than prolonged litigation. They also create opportunities for abuse if terms are hidden or public claims are discounted without explanation. Any proposed settlement should therefore have a documented rationale, proper authority and appropriate independent scrutiny. The relevant question is whether it secures a defensible public outcome, not whether it sounds tougher at a press conference.

People accused of wrongdoing must retain the protections of a fair process. That is not a concession to powerful suspects. It is how a recovery strategy avoids collapsing under challenge and how citizens are protected from selective enforcement. A government cannot repair abuse of public power by making arbitrary power its preferred instrument.

Negotiation needs a public objective

Where debt terms are a genuine source of pressure, negotiation may be appropriate. But “renegotiate” is a verb, not a complete plan. The government should explain what it seeks to improve: near-term cash flow, maturity concentration, cost, currency exposure or some combination. Different objectives can point towards different arrangements, with different long-term consequences.

A lower payment today can be accompanied by a longer obligation tomorrow. A transaction that eases one year’s budget may create costs elsewhere. The public explanation should therefore include the whole profile, relevant fees and major risks, rather than advertise only the most flattering immediate number. Comparisons should use consistent assumptions and identify what would happen if those assumptions prove wrong.

Confidential negotiating space may be necessary. That does not justify keeping the objective, decision authority or eventual terms beyond scrutiny. A government can protect live negotiations while publishing the framework against which the outcome will be assessed. Once an agreement is concluded, citizens should receive a clear explanation of what changed and why the result was accepted.

The opposition has obligations here too. It should test the assumptions and propose alternatives, not promise a superior bargain without showing how it would obtain one. Credibility grows when a political movement explains the constraints it expects to face in office. Saying that everything will improve after a change of leadership is not a financing strategy.

Protect people while choices are made

Any response to debt pressure should start with the services and livelihoods at risk. The costs of an ill-prepared decision can reach people who had no role in the original borrowing. That is why consequences for essential public spending, domestic institutions and the wider economy must be assessed before a course is announced. These are matters for current data and specialist analysis, not assumptions drawn from another country’s experience.

An implementation plan should identify the spending it intends to protect and explain how that protection will work in the budget. A general promise that ordinary people will be spared is insufficient. So is an adjustment programme that treats every expenditure line as equally dispensable. Public discussion should be able to compare actual options and the distribution of their costs.

This is not an argument that lenders’ interests must always come first. It is an argument that the public interest requires preparation. A government can challenge a claim strongly while planning for an adverse outcome. It can pursue relief while protecting its negotiating credibility. Courage is more useful when accompanied by a calculation of what happens if the preferred strategy fails.

The same discipline should govern political language. No leader should promise that a declaration alone will remove every obligation, prevent litigation and preserve all access to finance. Nor should officials claim that any scrutiny automatically makes instability inevitable. Both positions avoid the practical work of evaluating options.

Stop producing the next disputed loan

The audit’s forward-looking recommendations may ultimately matter as much as its retrospective findings. Better project appraisal, clearer approval records, publication of key terms and consistent tracking of proceeds can make future disputes less likely. Controls should be designed around the failures established by the evidence, rather than copied into another manual that no one uses.

Kenya already has public institutions whose work should inform this effort. The Auditor-General’s debt audit collection provides a starting point for identifying previous examinations and following up recommendations. The existence of a report should trigger a question about implementation. Repeating a recommendation for years without a visible institutional response is not the same as resolving it.

Parliament should require a public action table: the finding, the institution responsible, the proposed remedy, the deadline and the current position. Agencies should explain missed deadlines. Disputed recommendations should be identified and reasons given. The table should distinguish investigations, completed recoveries, negotiations and preventive reforms so that one kind of activity is not used to imply progress on all the others.

For a politics that takes public debt seriously, this is the test of substance. Criticism of the present arrangement must be accompanied by a workable alternative. That alternative should withstand scrutiny even when it is proposed by a party or leader one supports. No political camp should be allowed to replace the public’s questions with a request for personal trust.

The timetable should recognise that different remedies move at different speeds. Preserving records can begin immediately. A change to an approval process may take longer, while litigation may run beyond the political term in which it starts. Publishing those differences would help prevent impatience from being exploited by either side. Officials should not hide inactivity behind the complexity of a case, and critics should not equate every unfinished proceeding with abandonment. Clear milestones allow the public to distinguish genuine progress from a file that is merely being passed between offices.

The day an audit is published should begin a new phase of accountability. It should not be the day the campaign runs out of instructions. Kenya needs to know what will be recovered, what will be challenged, what may be negotiated and what will be changed before the next agreement is signed. A debt audit earns its public value when its findings become a credible course of action.