The National Treasury is set to take another hit as the Budget Appropriations Committee (BAC) seeks to adjust government spending by Sh138.9 billion in a supplementary budget tabled in Parliament yesterday to address the 2022 General Election, pending bills and security concerns.
BAC chairman Kanini Kega stated that the additional funds will also support drought-related interventions, Covid-19, salary shortfalls and the expansion of the Competency-Based Curriculum infrastructure.
“The upward adjustment of the budget is mostly on account of recurrent rather than development expenditure,” said Kanini.
An earlier Sh126.3 billion supplementary budget submitted to Parliament by the National Treasury in February, shed light on President Uhuru Kenyatta’s difficult balancing act and this one deepens the difficult choices that must be made with elections just around the corner.
The National Treasury prepared the first supplementary budget for the fiscal year 2021/2022 at a time when the economy was experiencing a rebound in growth, with revenue estimated to have increased by Sh16.6 billion between June and December 2021.
According to the BAC, pending bills totaled Sh432.2 billion as of September 2021, with State corporations accounting for 87.8 percent and ministries, departments and agencies (MDAs) accounting for 12.2 per cent of the bills, respectively.
“The committee is concerned that some reductions in the development budget could potentially lead to further pending bills accumulation, especially where commitments had already been undertaken or there are contractual obligations,” BAC noted in its budget policy statement.
The total approved budget for 2021/22 was Sh1.942 trillion, with recurrent expenditures accounting for Sh1.274 billion and development expenditures accounting for Sh668.378 billion.
Additional resources in addressing the National Development Implementation and Communication Cabinet Committee on Monday, Interior Cabinet Secretary Fred Matiang’i mentioned cyber and computer misuse, hate speech, and livestock rustling as election-related security challenges that must be addressed.
Matiang’i also stated that refugees and drought were posing a serious challenge to security management, stating that the number of people in need of food and water relief in arid and semi-arid lands counties had risen to 3.1 million as a result of below-average short rains last year.
Kanini said the committee was concerned that if this trend continues, it could eventually crowd out growth-enhancing expenditures under the development budget.
He also said there was an under-absorption of development budget attributed to foreign-financed projects.
“Many donor-funded projects face implementation challenges, mainly relating to low absorptive capacity by the recipient ministries, departments and agencies,” said Kanini.