By Tajeu Shadrack Nkapapa
National Treasury Cabine Secretary Prof. Njuguna Ndung’u writes to the National Assembly proposing far-reaching budget cuts on 2024/25 estimates, citing that Finance Bill changes could cause a 200 billion gap in the projected 2024/2025 budget.
On June 19, in a letter directed to the clerk of the National Assembly, Treasury CS Prof. Njuguna Ndung’u outlined budget reductions that would be enforced in various departments within the arms of government should the tax recommendations in the Finance Bill 2024 fail to receive approval from the National Assembly.
“Should the Finance Bill 2024 be approved as proposed by the National Treasury, the National Assembly can proceed with the consideration of the Appropriations Bill as published; However, if the revenue-raising measures contained in the Finance Bill 2024 are not approved by the National Assembly, there will be a likely revenue shortfall of approximately KSh.200 billion,” Prof. Ndung’u said.
The State Department of Higher Education will face a reduction of Ksh.8.3 billion, which will result in decreased allocations to the Higher Education Loans Board (HELB) among other impacts.
CS Ndung’u predicts that another significant casualty will be the approval of Junior Secondary School (JSS) teachers by the Teachers Service Commission (TSC), which is also set to lose Ksh.18.9 billion.
The Treasury has announced that both NG-CDF and the State Department for Roads will face a reduction of Ksh.15 billion for their ongoing road projects, as per the latest reports while The Department of Energy is set to undergo a significant reduction in its budget, with a cut of Ksh.21.7 billion that will impact the connectivity of the last mile in various constituencies.
Others to lose more money are the fertiliser subsidy program and the county equitable share will lose a Ksh.5 billion each, the Executive OP to lose (Ksh.451 million), State House (Ksh.500 million), State Department for Internal Security to miss (Ksh.2 billion), State Department for ASALS & Regional and Northern Corridor Development (Ksh.4.6 billion), Defence Ministry (Ksh.7.7 billion), State Department for Foreign Affairs (Ksh.1.8 billion).
More losers will be ICT Authority with a cut of 6.7B, Water works development Agencies – 11.6B, Galana Kulalu – 1B, Kenya Revenue Authority 4.7 billion, pending bills 5 billion, school feeding programme and school infrastructure to lose 3.4 billion respectively.
Kenya Airways is also at risk of losing Ksh.1 billion.
During the budget presentation on June 13, CS Ndung’u announced that Kenya aims to generate Ksh.3.992 trillion in the upcoming fiscal year.
To cover this amount, the government plans to secure Ksh.333.8 billion from foreign sources and Ksh.263.2 billion from the local market.
Additionally, the Treasury is proposing to raise Ksh.346.7 billion in revenue through higher taxes with the 2024 Finance Bill currently under debate in the National Assembly.