alexa 2012 polls push Budget past the trillion mark - Daily Nation

2012 polls push Budget past the trillion mark

Thursday June 2 2011

Finance minister Uhuru Kenyatta flanked by Permanent Secretary Joseph Kinyua addresses a news conference June 2, 2011 at the Treasury where he said that he will read a record budget of one trillion shillings come June 8.  FREDRICK ONYANGO

Finance minister Uhuru Kenyatta flanked by Permanent Secretary Joseph Kinyua addresses a news conference June 2, 2011 at the Treasury where he said that he will read a record budget of one trillion shillings come June 8. FREDRICK ONYANGO 

By LUKE MULUNDA [email protected]

The Budget has crossed the trillion mark, estimates for the 2011/12 fiscal year show. This signals more belt-tightening when the Finance minister reads the Budget speech on Wednesday next week.

According to official figures released by the Treasury Thursday, the total Budget for the next financial year is Sh1,155 billion, or Sh1.16 trillion, up by Sh158 billion this year’s Sh997 billion.

The speech will detail how the government plans to raise money to finance the Budget through taxation, privatisation of State-owned firms and borrowing.

The Budget was pushed up by, among others, Sh17.5 billion for preparations for next year’s elections.

In the 2011/12 Budget, Sh544.9 billion will go to recurrent expenditure, mainly paying civil servants’ salaries and daily administration expenses. Development expenditure, which focuses on long-term projects, will take Sh398.6 billion.

Consolidated Fund Services comprising servicing public debt, pensions and gratuities, salaries and allowances of constitutional offices, among others, will take Sh209.5 billion, while the civil contingency fund has been given Sh2 billion.

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The Teachers Service Commission will get the largest share of the Budget with an allocation of Sh103 billion. Among ministries, Roads tops with Sh94.9 billion, followed by Finance at Sh62.8 billion and Provincial Administration with Sh60.6 billion.

Other top gainers are High Education Sh53.2 billion, Basic Education Sh45.8 billion, Medical services Sh31.6 billion and Local Government at Sh24.4 billion.

Interestingly, the government has cut its recurrent expenditure by Sh130 billion as part of austerity measures to shift money into priority areas that will stimulate economic growth.

Nearly half of these savings, or Sh78 billion, have been funnelled into development projects as the government enhances infrastructure and moves to food production.

“To ensure pro-poor growth and sustainable development, the 2011/12 Budget will continue to focus on key priorities as a basis for allocation of resources. For instance, we will increase expenditure on infrastructure by 35.53 per cent from Sh165.811 billion in the FY 2010/11 to Sh221.411 billion,” said Mr Kenyatta.

Lots of cash has been poured into social welfare to boost disadvantaged sections of the population and the poor to increase their role in the economy.

Targeted interventions on this front “include improving access, transition rate, and quality of education; enhancing efficient and a high quality health system, ensuring security for all persons and property; empowering the youth and vulnerable members of the society by engaging them in gainful employment and wealth creation; implementation of the new Constitution and promoting food security.”

The Budget has allocated Sh840 million to provide bursaries for an additional 200 poor/orphaned children per constituency at the cost of Sh20,000 per child.

Some Sh385 million will go into the disabled persons safety net programme, Sh260 million to expand orphans and vulnerable children safety net from 60 to 72 districts, Sh240 million to increase cash transfer for senior citizens and Sh230 million to raise benefits for this group.

The Budget has been pushed up by new expenditures in implementing the new Constitution and setting the ground for the next General Election, expected in August 2012, which has been allocated Sh5.5 billion, while the electoral commission will bag Sh12 billion.

From the Budget figures, the government is still pumping more cash into infrastructure to lay the foundation for economic take off under the Vision 2030 development blueprint that aspires to make Kenya a middle income economy.

These are labour-intensive projects that create more jobs, which have been backed up by Sh1 billion more for small and medium-size enterprises.

Allocation for physical infrastructure, such as roads, railway, airports and energy has been increased by Sh55.6 billion in the current financial year to Sh221.4 in the 2011/12 fiscal year, representing 23.5 per cent of the total budget, up from 20.4 per cent in the current year.

Some Sh1.85 billion is earmarked for expanding and modernising commuter rail services and Sh1 billion to upgrade Thika-Nairobi railway line.