The State House and the department of Social Protection had by end of last month depleted their budgets for salaries and other recurrent items, amid a plan by the Treasury to prepare a third mini-budget for the current financial year, which ends in June.
Disclosures from the Treasury show that the State Department of Social Protection and Senior Citizens had spent Sh35.7 billion on salaries, allowances and other recurrent items, against a budget of Sh33.3 billion by the end of last month.
The State House had also spent 98 percent of the Sh7.96 billion allocated for the same items by the end of April.
The Treasury revealed that it was finalising the third supplementary budget for the current financial year — the first time the State's spending plan has been adjusted three times in a fiscal year since the Covid-19 pandemic —and that it would be tabled in Parliament by next month.
“We continue facing pressures on the expenditure side and we think that the deficit will edge up slightly. We are in the process of sending out a circular for supplementary III and the idea is to be more realistic on our revenue targets,” Albert Mwenda, the Director General Budget, Fiscal and Economic Affairs at the National Treasury said last week.
The Treasury had set a budget of Sh1.34 trillion for salaries, allowances and other recurrent items for the government in the current financial year. This target was, however, reviewed upwards to Sh1.412 trillion.
Mr Mwenda said that missed revenue targets due to the withdrawal of the Finance Bill, 2024 and a slowdown in the economic activity had prompted the need for a third budget review.
Depletion of the recurrent budgets by the two State bodies point to the country's struggle to rein in a runaway wage bill, which continues to squeeze funds for development projects.
The upcoming third supplementary budget is most likely to see State House, the department of Social Protection get increased allocations to cover their expenses. However, this will come at the expense of priority development projects.
The Treasury tabled the first supplementary budget following the withdrawal of the Finance Bill, 2024. A second one was submitted and passed by Parliament in February this year. The third one will be tabled with less than four weeks to the end of the financial year.
State House has been one of the biggest spenders in the William Ruto administration, with the office attracting public outrage over what Kenyans see as the wasteful expenditure of public funds.
The Treasury data shows that tax revenue in the ten months to April this year amounted to Sh1.8 trillion, representing 75 percent of the targeted Sh2.4 trillion in the current financial year.
The Kenya Revenue Authority (KRA) had initially been given a revenue target of Sh2.74 trillion, but this was later reduced to Sh2.4 trillion after the Finance Bill, 2024, was rejected.
→ jmutua@ke.nationmedia.com
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