EDITORIAL: Cut public spending - Business Daily

Editorials

EDITORIAL: Cut public spending

Monday, April 27, 2020 22:03

By EDITORIAL

Reports that Kenya recorded flat tax collections in the third quarter should sound the alarm on the need for the government to cut back public spending. Last Friday, the Treasury reported that the total tax receipts stood at Sh340.67 billion between January and March compared to Sh339.27 billion in the same period last year. On the other hand, the latest Controller of Budget report shows that spending in the public sector continues to grow unchecked, raising questions about the country’s ability to meet its obligations.

MCAs, for example, spent Sh6.58 billion on foreign and domestic travel in the first half of the fiscal year, the highest in a similar period since the start of devolution in 2013. Further, the expenditure on travel for the presidency, ministries, departments and agencies also increased compared to a similar period a year before.

Given these spending trends, flat revenue collection on the back of the escalating recurrent expenditure means that the efforts to bridge the Budget are unlikely to achieve the desired results. Besides reviewing spending on non-essential vote heads, the Treasury should further tighten the noose on wastage but with the full support of the national and county governments, which must now adjust and align expenditure to the reality of constrained revenue occasioned by economic slowdown due to the negative effects of Covid-19.