Treasury CS Ukur Yatani has presented the 2020/2021 budget in parliament which comes in the midst of the Covid-19 pandemic, with focus on the economic recovery after the pandemic and cushioning Kenyans by creating employment for youths, supporting local industries, enhancing health coverage among others. Some of the highlights of the Kshs 2.7 trillion budget include;
The Big Four Agenda. CS Yatani said the budget will continue the implementation of the Big Four Agenda, with the targeted expenditure prioritizing employment creation, youth empowerment, support to local industries and improving health coverage. Kshs 128.3 billion has been set aside for the Big Four Agenda driver and enablers. The health sector has got the lion share at a proposed Kshs 111.7 billion. Kshs 15.5 billion has been set aside for the Housing, Urban Development and Public works sector under the affordable housing project. To promote reforms in the manufacturing sector and support local industries Kshs 1.4 billion go to the Kenya Industrial Entrepreneurship project, Kshs 3.5 billion for development of special economic zone, textile park in Naivasha, Kshs 843 million to support modernization of Rivatex, Kshs 715 million for the Kenya Youth Empowerment and opportunities project. To improve food security and nutrition, Kshs 52.8 billion has been set aside for food security.
Pending Bills. CS Yatani said Kshs 1.3 billion has been set aside for clearing pending bills. All Principal Secretaries and accounting officers have been ordered to clear all pending bills and state corporations including Ministries which accumulate pending bills will experience delays in future funds disbursements.
Debt. CS Yatani said Kenya’s debt remains sustainable despite some of the burden debt indicators deteriorating due to the impact of the Covid-19 pandemic which has elevated expenditure pressures, “The debt burden is expected to decline over the medium term in line with the fiscal consideration plan and implementation.” He said as an alternative source of finance to fund projects the government will revitalize the public private partnership framework.
Pension payments and digital tax. All pension payments accrued over the years are to be are to be cleared by the end of the calendar year. “The national treasury is re-engineering and upgrading the pension system to clear all pension payments. This will guarantee smooth transition of retirees from a monthly salary cheque to monthly pension payment,” said the CS. A digital tax of 1.5 percent on value transaction has also been introduced by the government.
Deficit. CS Yatani said the fiscal deficit will decline in 2020/21 financial year to Kshs 840.6 billion form Kshs 842.7 billion. To cushion business affected by the Covid-19, a team has been constituted to review the situation faced by state owned enterprises and revert in 90 days.
Anti-Corruption war. To enhance the war against corruption instill good governance practices and recover assets, the government has allocated Kshs 3.1 billion to the EACC and a similar amount for the office of the Director of Public Prosecutions.
SGR and CDF: The SGR Phase Two development project has been allocated Kshs 18.1 billion and Kshs 5 billion for Mombasa Port development. The Constituency Development Funds receive Kshs 41.7 billion.
Counties and Parliament. Counties allocation for the financial year 2020/2021 is Kshs 361.9, while parliament has been allocated Kshs 37.3 billion.