NAIROBI, KENYA: CS Henry Rotich 2019/20 budget highlights as presented before the Parliament
On Pending Bills
Government reviews pending bills as ordered by President Uhuru Kenyatta, prioritises payment of Sh10.9 billion of the verified pending bills which will be paid before end of this month.
“This should eliminate most pending bills owed to the youth, women and persons living with disabilities under the Access to Government Procurement Opportunity. The clearance of this backlog should improve liquidity to our suppliers and contractors and thereby boost our economy.”
On Micro, Small & Medium Enterprises
CS Rotich consolidates three Funds into one to be known as Biashara Kenya Fund to increase efficiency and eliminate overlaps.
The Fund will give special priority to businesses owned by youths, women and people living with disabilities. The Regulations establishing the new Fund have been published after being subjected to stakeholder consultations and I will be submitting them to this House today.
On improving Expenditure Efficiency
Government to use of a more efficient cost cutting approach, including use of electronic cards system for all public officers travelling within and outside the country. This card would be pre-loaded with subsistence allowance to be expended by Officers travelling on official duty on eligible expenditures only.
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In order to contain the wage bill, Rotich proposes to limit strictly the extension of service for the significant number of civil servants who are retiring after the age of 60 years.
In addition, the government will restrict new recruitment to key technical staff, security personnel, teachers and health workers. Further.
Government will also fast track migration away from the current Integrated Payroll and Personnel Database System (IPPD) to IFMIS Human Resource Module to improve payroll management.
Increasing Tax Collection
In terms of administrative measures to enhance revenue collection and seal revenue loopholes, a number of initiatives are underway, including, sustaining the fight against illicit and counterfeit trade that was launched last year.
KRA will continue to strengthen and upgrade the ICT systems, including the full rollout of the integrated customs management system which has been delayed for too long;
Information sharing through Memorandum of Understanding (MoUs) with other jurisdictions to support the fight against cross-border tax evasion;
“Our economy continues to be resilient in the midst of significant global and domestic elements. In 2018 our economy grew by 6.3 per cent, up from 4.9 in the previous year, the growth is the highest to have been recorded for the past 8 years and well above the sub Saharan Africa regional average growth of 3% and global average of 3.6 per cent.”
“We project growth in 2019 to remain strong at around the same level in 2018,”
“In relation to GDP this deficit represents 5.6 per cent a decline from 6.8 per cent in this financial year and 7.4 per cent in the last financial year,”
“The fiscal deficit of 5.6 per centwill be financed by net external financing of 324 billion, and net domestic financing of Sh283.5 billion,”
Fiscal framework to stabilise and reduce debt
Resource mobilisation through borrowing will be in accordance with the Public Finance Management Act, 2012 and guided by the annual Medium Term Debt Management Strategy, which Parliament approves annually, and which seeks to minimize costs and risks on public debt and borrowing.
To strengthen the debt office to adopt modern liability management instruments to reduce cost and settlement risks, in addition to introducing an investor relations unit.
County Governments in the coming financial year will receive a proposed allocation of Sh371.6 billion, of which, Sh 310 billion is the equitable share and Sh 61.6 billion will be conditional transfers, including Sh38.7 billion from development partners.
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