President Ruto's budget expands by Sh22billion on county transfers, recurrent costs 

President William Ruto projects to increase government spending by Sh22.1 billion in the revised expenditure plan for the 2023/24 financial year, after expanding the budget to Sh3.66 trillion, even as he lines up his priority areas.

In the revised 2023 Budget Policy Statement (BPS) released by the National Treasury yesterday, the projected recurrent spending has been revised upwards by Sh37 billion while development spending has been lowered by Sh27.1 billion. Transfers to counties have been revised upward by Sh12.3 billion.

In the updated expenditure plan, the government plans to invest heavily in agriculture, infrastructure, health, defence and education sectors, which have received generous allocations in the proposed budget.

On the other hand, energy projects will suffer as the government proposes to scale down funding for power generation and distribution.

The BPS 2023, which spells out Treasury’s policies for the 2023/24 fiscal year, shows that the government plans to upscale funding for livestock resources management and development from Sh7.2 billion in the previous budget to Sh19.3 billion, as one of the key areas for change within the agricultural sector.

The government also proposes to raise funding for rail transport from Sh31.9 billion to Sh42.2 billion, while transferring the programme from Treasury to the Transport sector, while in the health sector, a new programme on national referral and specialized services has been introduced, with a Sh84.3 billion funding.

President Ruto’s office, which also accommodates Deputy President Rigathi Gachagua and Prime Cabinet Secretary Musalia Mudavadi’s offices, will also enjoy budgetary increments in the financial year starting July 2023, with proposed increased funding for State House affairs from Sh4.37 billion to Sh5.86 billion.

DP Gachagua office’s budget has also been raised from the original Sh1.7 billion in the 2022/23 budget to Sh4.5 billion, while Mr Mudavadi’s office will be funded with Sh2 billion.

Education budget

In the Education sector, funding for primary education increased from Sh19.9 billion to Sh32.6 billion, secondary education by Sh5 billion to Sh86.4 billion and university education from Sh108 billion to Sh115 billion.

Funding for the Teachers Service Commission (TSC) has been raised from Sh298 billion to Sh322 billion, as the government continues with a programme to employ more teachers in the wake of transition of students to Junior secondary schools.

But some sectors were not as lucky in President Ruto’s new economic plans, with among key ones that have been affected being Energy, where funding for power generation is proposed to be cut from Sh20.5 billion in the 2022/23 budget to Sh15.2 billion in 2023/24.

Treasury also proposed to cut funding for power transmission and distribution from Sh72 billion to Sh59 billion, a move likely to affect the government’s last-mile electricity connectivity programme.
President Ruto has also spelt out a concrete plan to mobile Sh50 billion in 2023/24 to undertake various projects, mainly in the water, housing, roads and energy sectors.

“The PPP Directorate envisages mobilizing Sh50 billion within the FY 2023/24, based on the current projects in the PPP pipeline. To achieve this, all projects will be screened for commercial viability as PPPs, before being considered for implementation within the National Budget,” Treasury stated.

In the roads sector, for instance, the government plans to mobilise private sector resources in the development of the Mombasa - Nairobi – Malaba road corridor. 

“This is intended to alleviate congestion, improve safety and enhance connectivity to boost trade and investment,” Treasury says.

The government also intends to pilot transmission line PPPs by way of the financing, design, construction, operation and maintenance of the 400KV, 165km - Loosuk – Lessos Transmission Line and the 220KV, 72km – Kisumu-Musaga Transmission Line as part of the PPP programmes.

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