Government to reduce expenditure on non-core activities to fund key priority areas


The Government will reduce expenditure on non-core activities to fund key priority areas, Treasury Cabinet Secretary Henry Rotich has said.

Mr Rotich said to support economic growth; the Government had adopted a raft of measures to fund its key policy while safeguarding a sustainable debt position.

Speaking during the opening of the public hearings for the 2018/2019 Medium-Term Budget at the KICC, Nairobi, attended by Deputy President William Ruto, Mr Rotich said allocations to key areas- universal healthcare, food security, manufacturing housing; education, infrastructure, energy and social protection will be prioritized.

Among the raft of measures to shore-up revenues include expansion of the tax base to informal sector, lotteries, overhaul of the income tax act to remove most of the tax exemptions, rolling out of integrated customs management systems to prevent concealment, undervaluation, mis-declarations and falsifications of import documents.

Others, Mr Rotich said, were implementation of the regional electronic cargo tracking to tame transit diversion, scaling up on-going and routine activities such as pre-verification of conformity, benchmarking and auctions.

He said other measures included data matching and use of third party data to enhance compliance by integration of iTax with IFMIS, expansion of tax base by targeting informal sector, betting lotteries and gaming, pursue non-filers as well as enhance investigations, intelligence capacity and KRA capacity to support revenue collection.

“We are all aware that implementation of the ‘Big Four’ plan requires huge capital outlay. To ensure we create fiscal space to raise the required resources we shall undertake a raft of expenditure reform measures,” said Mr Rotich.

The Deputy President said projects that would help deliver the ‘Big Four’ development agenda at the heart of the Government’s plans to create jobs over the next five years would be prioritized.

Mr Ruto said the Government will significantly increase the level of investments in food security, affordable housing, manufacturing and affordable healthcare for all.

“We will focus on addressing the challenges Kenyans are facing through investments that enhance the attainment of desired development objectives,” said Mr Ruto.

The Deputy President said public participation in budget making process promotes transparency and accountability.

“Public engagement in budgeting as contained in the Constitution benefits the Government and the public. Participation improves the overall knowledge about the budget and fiscal situation thus creating both a more informed public and a more responsive budget,” said Mr Ruto.

He said the public would also have the opportunity to assess the most critical needs and discuss the type of budget and development projects they would like to be implemented by the Government.

The Deputy President said enrolment in primary schools increased to over 10.5 million in 2017 because of sustained support of the Free Primary Education Programme. In turn, the Primary Completion Rate improved to over 84 per cent while the secondary transition rate also increased to 85 per cent in the same period.

With provision of free day secondary education, he added, the Government expected to achieve 100 percent transition.

Mr Rotich also said the targeted expenditure reform measures included zero based budgeting, managing the ballooning public wage bill, enhancing public investment management, addressing the rising pending bills, leveraging on public private partnership, reforming the state owned enterprise and creation of an enabling environment for the private sector to thrive.

Chairman of the Parliamentary Committee on Budget and Appropriation Kimani Ichungwa called on the need for prudent management of public resources.

He said projects, which have direct impact on the lives of Kenyans, should be prioritized.

“Parliament will work closely with the executive in ensuring that only project which can impact positively on the lives of Kenyans are prioritized as far as funding in the next financial year is concerned,” said Mr Ichungwa.

Mr Ruto said measures have been put in place to ensure proper implementation of development projects both in national and county governments.

Cabinet Secretaries James Macharia (Transport), Jacob Kaimenyi (Lands), Dan Kazungu (Mining), Amina Mohammed (Foreign Affairs), Eugene Wamalwa (Water and Irrigation) and Najib Balala (Tourism) among others were also present.