Cabinet Secretary for National Treasury and Economic Planning John Mbadi before the National Assembly Public Debt and Privatisation Committee at Continental House Nairobi on November 28, 2024.
Budget allocations to education, security, and healthcare have been increased even as water, housing, and energy to a cut in spending adjustments that have expanded the budget size for the current financial year by Sh85.8 billion. This figure excludes Sh5.5 billion apportioned for Consolidated Fund Services which caters for the debt repayment obligations.
On Tuesday, the National Treasury tabled the second Supplementary budget to the National Assembly which increased the size of Kenya’s budget for the financial year ending June to Sh3.56 trillion from the current Sh3.47 trillion. Treasury is also seeking lawmakers’ approval for additional spending that ministries had not been given the green light to spend.
“Since the approval of the financial year 2024/25 budget, the National Treasury has received additional requests for funding to cater for emerging priorities and shortfalls under critical expenditures,” said the National Treasury.
Supplementary Estimates
“Included in the financial year Supplementary Estimates No. II are additional expenditure to cater for salaries shortfall, security related interventions, drought-related expenditures among other emerging priorities,” added Treasury.
The mini-budget is supposed to take care of, among others, additional salaries approved additional expenditures for some projects, and in light of increased collection of fines and fees by ministries.
Spending on higher education, basic education, Technical and Vocational Education, and Training (Tvets) has been increased by Sh48.58 billion, with a big chunk of the money, Sh17,438,697,360, going to the Teachers Service Commission (TSC) to hire tutors.
Higher education has been allocated an additional Sh15.577 billion, with the government channelling an additional Sh1.8 billion to the troubled Moi University. Most of the institutions of higher learning have seen their budgetary allocation increase due to an increase in the fees they collect from students.
Moi University in Kenya. John Mbadi Higher Education has been allocated an additional Sh15.577 billion, with the government channelling an additional Sh1.8 billion to the troubled university.
The State Department for Medical Services received an additional Sh8.68 billion, most of it, Sh6 billion, for general administration of referral hospitals. The national referral and specialized services have been given an additional Sh3.1 billion.
The second supplementary budget for the current financial year has also slashed spending for some departments in housing, water, and energy as Treasury as it aligns with the latest reality of depressed revenue collections which were aggravated by the anti-tax protests in July and August last year.
Development cash for the State Department for Housing and Urban Development was reduced by Sh13.94 billion with the biggest casualty being on human development and settlement which lost Sh8.4 billion. Urban & Metropolitan development has lost Sh5.52 billion.
Water and Sanitation
Water and sanitation is the other loser after its budget was slashed by around Sh8,732,682,634. Development cash for water and sewerage infrastructure development lost Sh7.28 billion in the latest changes while water resources management was docked Sh1.45 billion.
The State Department of Energy has lost Sh7.636 billion in changes that await parliamentary approval.
Treasury is bullish that despite the protests in July and August that disrupted economic activities leading to a shortfall in revenue collection, implementation of the budget in the current fiscal year has proceeded smoothly.
The Kenya Revenue Authority has fallen short of its revenue targets in the first six months, owing to a tough business environment that has been aggravated by high interest rates charged by banks.
