Treasury Cabinet Secretary Henry Rotich has told ministries and departments to align their short and medium term expenditure to four priority areas President Uhuru Kenyatta identified in his last term.
The goals are universal healthcare, food security, affordable housing and job creation through manufacturing.
Mr Rotich said departments must scrap unnecessary spending to free up resources to be invested in the priority areas.
“Sector budget proposals, both recurrent and development, will be reviewed afresh in the context of zero-based budgeting to create fiscal space for these priorities,” Mr Rotich said in the November 29 memo.
“Every sector is required to recast the resource allocation criteria and justification for bidding.”
From Monday, ministers and accounting officers of commissions and independent offices were to meet Treasury officials to align their spending with the President’s targets.
The economic adviser at the executive office of the President, Mr Mbui Wagacha, told the Business Daily that the four areas were part of the government plan to drive growth through public spending.
They were also chosen to address social needs of the majority, said Dr Wagacha.
“It is about investment-led growth that pays demographic dividends,” he added.
Dr Wagacha said elimination of waste in recurrent expenditure could help finance the programmes sustainably to achieve the objectives.
Analysts say the priorities reflect the quest to deliver social promises made during political campaigns, adding that how the government goes about implementing them would determine their success or failure.
Mr Robert Bunyi of Mavuno Capital said implementing a universal healthcare system, in particular, was likely to saddle taxpayers with a huge bill.
“The big issue with universal healthcare is cost. It will be better to create more jobs and have people pay for themselves,” Mr Bunyi said.
If implemented to mirror similar programmes elsewhere, patients would access healthcare for free, except for prescriptions and special services.
The National Health Service in the UK pays the cost of most treatment for citizens.
UK spending on healthcare is estimated at 9.1 per cent of GDP or nearly double Kenya’s 5.7 per cent, according to the World Bank.