NYS overshoots its Sh1.39 billion budget : The Standard

The National Youth Service spent more than it had budgeted for on development, once again raising eyebrows on the financial discipline of the State Department. Latest data from the National Treasury shows that the State Department of Public Service and Youth received and spent Sh1.5 billion against a revised budget of Sh1.39 billion during 2018/19 financial year. Before the start of the just concluded budget cycle, Treasury had allocated Sh25.8 billion to the National Youth Service before law-makers slashed it by a third. Ministries, departments and agencies (MDAs) did not spend Sh40 billion of their development kitty, with the Office of the Director of Public Prosecutions (ODPP), Ethics and Anti-Corruption Commission, Independent Electoral and Boundaries Commission and the Teachers Service Commission failing to spend even a cent of their development money.

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Another major non-spender was the Parliamentary Service Commission (PSC), employer of law-makers, which failed to utilise more than half of their development cash. The Ministry of Water and Sanitation failed to spend the most cash, Sh6 billion, or a third of its development cash in a financial year that saw stage agencies fail to spend only 11 per cent of their development funds. This expenditure comes at a time when the government has been implementing a raft of austerity measures that also saw President Uhuru Kenyatta freeze spending on new projects until the ongoing ones are completed. At the beginning of the just-ended financial year, projects worth Sh410 billion were put on hold following President Kenyatta’s freeze orders. He froze all new projects, save for those related to his pet plan, Big Four Agenda. “There will be no new embarked until you complete those that are ongoing,” Mr Kenyatta notified Principal Secretaries, heads of parastatals and chairpersons of parastatal boards.

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Over-ambitious targets “Even if new projects are aligned to Big Four, they cannot be started without express authority from CS or PS of the National Treasury,” he added. As a result, MDAs could only access money to pay salaries and administrative costs as they awaited Treasury’s approval for various projects. This is even as the Kenya Revenue Authority missed its target by Sh250 billion, collecting Sh1.44 trillion against its original target of Sh1.69 trillion. Even after Treasury revised the target twice to Sh1.51 trillion in May, the taxman still fell short in what some experts have attributed to “over-ambitious targets” by the government. While tax revenues grew by 10 per cent from Sh1.31 trillion collected during the 2017/18 fiscal year, total expenditure grew even faster by 24 per cent. National Treasury borrowed a massive Sh891 billion during the period under review, with the Central Bank of Kenya Governor Patrick Njoroge recently putting the fiscal deficit- or the difference between spending and tax revenues- at 7.4 per cent of the Gross Domestic Product (GDP). Treasury estimated the fiscal deficit for 2018/19 at 6.8 per cent. In the current financial year, the government plans to spend Sh686 billion on ministerial development expenditure. And just as in the last financial year, the government has frozen all new development projects save for those related to President Uhuru Kenyatta’s Big Four Agenda in which the government aims to ensure universal access to healthcare, food by all; creation of jobs by revamping the manufacturing sector and building over half a million cheap homes. In a circular published on July 23, the Cabinet directed that all State corporations be allowed to spend only a quarter of last year’s recurrent budget. “This amount should support all priority expenses over the first quarter ending September 30, 2019,” read the circular which was issued by the Head of the Public Service Joseph Kinyua. “During this moratorium period, no capital expenditure is to be undertaken unless the particular expenditure item is an ongoing project and is specifically approved in writing by the National Treasury.”

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