Treasury likely to cut budgets as ministries seek Sh69bn
National Treasury Cabinet Secretary Henry Rotich. PHOTO | SALATON NJAU | NATION MEDIA GROUP
What you need to know:
The amount could be reduced by Sh29.5 billion as the National Treasury
Kenya Revenue Authority missed its half-year target by Sh47.6 billion.
Budget and Appropriations Committee members have in the past criticised the Supplementary Budget as a symptom of unrealistic planning by the Treasury.
Ministries and other national government agencies have asked for an additional Sh69 billion to fund their budgets for the remaining part of the current financial year, the Treasury has said.
But this amount could be reduced by Sh29.5 billion as the National Treasury has recommended that the various agencies get an additional Sh39.5 billion for critical spending.
This is what Parliament could be asked to consider in the Supplementary Budget, which is among the issues to be tackled when the elected representatives get down to work starting tomorrow.
“In view of revenue shortfalls and little scope in domestic borrowing,” the Treasury said in a draft of the Budget Policy Statement, “these critical expenditures will be funded solely through expenditure rationalisation and commitments from development partners.”
This means that rather than come up with new measures to increase revenue collection, the Treasury will be cutting budgets.
MISSED TARGETS
The reduction would ease pressure on the entire revenue collection system following revelations that it missed its half-year target by a massive Sh47.6 billion.
Members of the Budget and Appropriations Committee have in the past criticised the Supplementary Budget as a symptom of unrealistic planning by the Treasury.
Treasury Cabinet Secretary Henry Rotich said in the draft statement published last week that the measures would include reducing expenditure that is not considered a priority, which would free resources for “more productive purposes”.
Slow and delayed projects will also suffer reductions in the funds available for them.
Treasury officials did not specify the ministries and other agencies that have asked for additional funding.
Ironically, the spending of money intended for both recurrent and development expenses was below target by last December, the halfway point of the financial year.
The Government had planned to spend Sh997.2 billion by that time but spent Sh769.2 billion, Sh228 billion less.
Of this amount, Sh35.8 billion was meant for recurrent expenditure and Sh139.2 billion for development, with Sh50.5 billion meant for counties.
