Kenya is staring at a Ksh 344.3 billion revenue shortfall in the current financial year as a result of the rejection of the Finance Bill 2024, the National Assembly has warned.
President William Ruto declined to sign the bill on June 25, 2024 following a series of countrywide protests.
The Budget and Appropriations Committee of the National Assembly says while the house considered the expected revenue shortfall in the Supplementary Appropriation (No.2) Bill which was passed on Wednesday last week, total reduced expenditure by the National Government will only amount to Ksh 145 billion.
“While it could be prudent to reduce expenditures by the amount equivalent to the anticipated revenue shortfall of Ksh 344.3 billion, this was not tenable given the delicate balance between austerity measures and cushioning the livelihoods of the people and the economy,” said the committee.
Parliment slashed the national government recurrent expenditure by Ksh 40 billion and development expenditure by Ksh 105 billion.
“In this regard, the Bill seeks to create a balance by reducing recurrent expenditure while safeguarding critical essential expenditure in the agriculture, health and education sectors among others,” the said the Ndindi Nyoro led-committee.
Out of the total amount of budget reduction, the Executive will have a budget cut of Ksh 139.81 billion, Parliament Ksh 3.7 billion and Judiciary Ksh 2.1 billion.
State House and Office of the Deputy President will have a recurrent budget reduction amounting to Ksh 6 billion, National Treasury Ksh 7 billion, while various development projects under medical services- will have a recurrent budget cut of Ksh 6.9 billion.
Transport and infrastructure sector which is having pending bills from stalled road projects will see a recurrent budget cut of Ksh 17.3 billion.
In the current fiscal year, the National Assembly approved pension payment amounting to Ksh 23.8 billion and Ksh 13.5 billion for the National Government Constituency Development Fund which were due as at the close of the FY2023/24.
In the Supplementary Appropriation (No.2) Bill, agriculture sector has been allocated Ksh 20 billion to support farmers enhance production.
Of this, Ksh 7.5 billion has been appropriated for the fertilizer subsidy programme, Ksh 3 billion for the Coffee Cherry Fund, Ksh 2 billion to waive coffee farmers’ debts and Ksh 2 billion for the purchase of milk coolers.
Ksh has been has been set aside for milk price stabilization while Ksh 700 million will support sugar farmers.
Education and social reforms will receive total allocation amounting to Ksh 120.7 billion, health sector Ksh 16.2 billion and Ksh 3.5 billion to cater for wages of security officers.
The Bill has also set aside Ksh 3.5 billion towards the enhancement of remuneration for the officers serving in various security organs in line with the recommendations of the Report of the National Taskforce on Police Reforms chaired. This is to promote the dignity and living standards of the officers in the security sector,” the committee said.
