High-Level Government Offices to Face Budget Cuts Amid Austerity Measures » Capital News
NAIROBI, Kenya, June 26 – High-level state offices are set to face significant budget cuts following austerity measures announced by President William Ruto after heeding calls to withdraw the Finance Bill 2024 following protests that left over 20 dead.
Thousands of youths took to the streets on Tuesday rejecting the Bill while accusing the president of forcing it on Kenyans. He subsequently sent it back to Parliament in a proclamation signed on Wednesday.
President Ruto emphasized that the withdrawal of the Bill would result in a budget deficit, with no additional taxation mechanism to finance the Sh3.9 trillion budget for the upcoming financial year. He assured that operational expenditures in the three arms of government, as well as devolved units, would be reduced.
“In the Presidency and Office of the Presidency, we will reduce the confidential vote, travel budget, hospitality, purchase of motor vehicles, renovations, and other expenditures,” Ruto stated.
President Ruto affirmed his administration’s commitment to listening to the will of the people and vowed to tackle corruption ruthlessly.
“We must live within our means, respecting the very loud message that is coming from the people of Kenya. I will have conversations with stakeholders on this matter as we chart our way forward,” the President said.
The Head of State noted that various pending development projects would face setbacks due to the budget cuts, given the calls by Kenyans for a ‘leaner’ budget during these harsh economic times.
“Without the Finance Bill, it means some of the development programs amounting to Sh200 billion will have to be cut, delayed until next year, or canceled because Kenyans have said they want a leaner budget,” President Ruto said.
As MPs debated the finance bill, the National Treasury submitted a statement to the National Assembly announcing contingency cuts amounting to Sh1.52 trillion for the 2024/2025 financial year should the bill not pass.
Budget and Appropriation Chairperson Ndindi Nyoro told Members of Parliament that Treasury would have no option but to slash the budget in various sectors due to the finance deficit if the bill hits a snag.
Proposed budget cuts include Sh900 million for the provision of sanitary towels, a recurrent expenditure cut under the National Government Affirmative Action Fund (NGAAF), and a further Sh600 million cut under the medical vote.
Other proposed cuts are Sh15 billion from the National Government-Constituency Development Fund (NG-CDF) kitty, Sh15.1 billion from ongoing road projects, Sh11.6 billion from various projects under the waterworks development agencies, and a further Sh7.75 billion from Security Operations and Modernization under the Ministry of Defence.
Security operations under Internal Security will be slashed by Sh2 billion, and the budget for various Regional Development Authorities will be reduced by Sh4.6 billion.
Additional proposed cuts include Sh1.85 billion from foreign relations and diplomacy, Sh800 million from ongoing TVETs and TTIs projects, Sh2.1 billion from funding for the Differentiated Unit Cost model in universities, Sh3.2 billion from the Higher Education Loans Board (HELB), and Sh3 billion from university infrastructure projects.
Infrastructure for primary and secondary schools is facing a proposed budget cut of Sh1.6 billion, the school feeding program Sh1.8 billion, Kenya Revenue Authority (KRA) Sh4.7 billion, Kenya Airways Sh1 billion, and the Civil Servants Insurance Scheme Sh1 billion.
The Equalization Fund arrears face a Sh1 billion cut, pending bills Sh5 billion, provision for medical interns Sh3.7 billion, and Managed Equipment Service (MES) under the state department for medical services Sh1 billion.
CS Ndung’u is seeking to slash the budget of the Office of the President by Sh451 million and a further Sh500 million from operations under State House.
The Ethics and Anti-Corruption Commission (EACC) will lose Sh200 million, and the office of the Director of Public Prosecutions Sh195 million.
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