MPs query bid to raise debt ceiling to Sh2.5trn
What you need to know:
- Chairperson of the parliamentary committee Mutava Musyimi said they would be hesitant to increase the debt ceiling unless convinced of its feasibility.
- Mr Musyimi said there would be a need to analysis the debt portfolio and accompanying interest rates.
A parliamentary committee is scrutinising a request by the National Treasury to have the country’s debt ceiling increased from Sh1.2 trillion to Sh2.5 trillion.
The Budget and Appropriations Committee in the National Assembly asked Treasury on Wednesday to submit to Parliament an analysis of the country’s debt portfolio over the years to assist in reaching a decision.
Chairperson of the parliamentary committee Mutava Musyimi said they would be hesitant to increase the debt ceiling unless convinced of its feasibility.
Mr Musyimi said there would be a need to analysis the debt portfolio and accompanying interest rates.
The committee met National Treasury Principal Secretary Kamau Thugge on Wednesday, when he presented the request from the Executive to increase Kenya’s external borrowing by more than 100 per cent.
According to the Public Finance Management Act, the national government may borrow money only for the Budget, as approved by Parliament, and the allocations for loans approved by Parliament.
The Act further lays the criteria for borrowing, and allows this only for development needs, not recurrent expenditure.
Dr Thugge said revenue collection is projected to grow in the next few years, hence the increased debt would be manageable.
He asked Parliament to consider approving the increase.
