The ‘big four’ run out of funds as the Treasury turns to other priorities

By JAMES ANYANZWA

Projects inherited from Kenyan President Uhuru Kenyatta under the “big four” program face more implementation challenges as the national treasury diverts borrowed resources to fund urgent government operations.

Budget Controller (CoB) Margaret Nyakang’o pointed to the emerging trend in the National Budget Execution Review Report for the first quarter (July-September) of fiscal year 2021/2022

The report, dated October 2021, shows allocations, 10 key sectors of the General Economic and Commercial Affairs (GECA) sector – which is an important player in the creation of jobs and wealth – industrial development, investments and promotion of trade, development of tourism, mobilization of savings. and cooperative development, regional integration and development received the lowest budget allocation in fiscal year 2021/22.

According to the report, the government’s non-alignment of sector budget allocations with the “Big Four Agenda”, delays in settling outstanding invoices and the failure by the National Treasury to comply with the cash flow plans of ministries and departments. and agencies (MDA) and forecasts during the disbursement of funds hampered the effective implementation of the budget in the three months leading up to September 30, 2021.

According to the report, all sector programs and budget allocations should be aligned with sector functions to achieve the “big four”.

National priorities

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“The CoB therefore recommends aligning and harmonizing programs and resource allocation to closely support the Big Four Agenda.

“This will improve the achievement of the Medium Term Plan goals and national priorities,” Dr Nyakang’o said in the report dated October 2021.

“There is a need for the national government to ensure that all critical issues are resolved quickly. “

Total national government spending in the three months to September 30 of this year amounted to $ 5.63 billion, including development and recurrent spending of $ 1 billion and $ 4.63 billion respectively.

A total of $ 1.09 billion, representing 44.2% of ministerial gross recurrent spending, was spent on employee compensation, during the period under review, followed by current transfers ($ 792.23 million) and operations and maintenance at $ 593.66 million.

The Teachers’ Services Commission recorded the highest expenditure on employee compensation at $ 601.07 million (54.8% of total expenditure) in employee compensation by the national government.

The government has prioritized the implementation of the projects inherited from President Kenyatta as part of the economic stimulus plan, including the continuation of the economic stimulus program to protect vulnerable citizens and businesses affected by the Covid pandemic. 19.

Affordable housing

In Budget 2021/22, Cabinet Secretary of the Treasury Ukur Yatani allocated $ 1.26 billion for projects that span universal health care, affordable housing, manufacturing for job creation and food and nutrition, security and an additional $ 206.25 million for the economic stimulus package.

“In this regard, the government will accelerate the implementation of programs and projects under the ‘Big Four’ program to improve food and nutrition security, achieve universal health care, provide affordable housing and support growth. manufacturing sector for job creation, ”Yatani said. in its budget statement for the 2021/22 financial year.

Development spending was down 34.8% from the $ 1.53 billion spent in a similar period in fiscal year 2020/21.

According to the report, the National Treasury relied heavily on external borrowing to finance the budget, resulting in disproportionate growth in public debt which rose 3.6 percent to $ 71.42 billion in three months. as of September 30 of this year, compared to $ 68.83 billion in the same period in the last fiscal year (2020/21).

Debt was 51% external lenders and 49% domestic lenders, with an allocation for public debt service in fiscal year 2021/22 amounting to $ 10.44 billion, compared to 8.55 billion dollars allocated in the previous fiscal year (2020/21).

According to the National Treasury, outstanding bills as of June 30, 2021 amounted to $ 506.96 million and a total of $ 33.92 million has been paid in the first three months of fiscal year 2021/22, leaving an unpaid balance of $ 472.14 million, excluding $ 894,196.42 deemed ineligible.

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