Rédaction Africa Links 24 with Kenyans.co.ke
Published on 2024-03-11 17:14:08
The Parliamentary Budget Office (PBO) recently released a report recommending that the Treasury should limit supplementary budgets to exceptional cases of unforeseen emergencies in order to curb wastage and ensure the prudent use of limited resources. Supplementary budgets are additional financial plans created by governments to address unexpected expenses or changes in priorities that were not initially allocated for, allowing for adjustments and reallocation of funds to meet evolving needs.
The report, titled “Debt Anchor vs Economic Growth: Walking the Tight Rope,” highlights the urgent need to rein in on wanton wastage in government spending, especially considering Kenya’s mounting debt and multiple competing needs. The office suggests that the government should restrict spending to the main budget unless unavoidable circumstances such as disasters, civil servant strikes, or critical events in the political landscape necessitate additional funding.
If implemented, this policy shift would require Ministries, Departments, and Agencies (MDAs) to align themselves with the new guidelines. The aim is to ensure that government efforts to achieve fiscal austerity are not undermined by supplementary budgets that call for more money or additional borrowing. The report points out that government institutions have been misusing Article 223 of the Constitution, which allows the national government to adjust spending plans in specific situations.
According to the report, the misuse of Article 223 weakens the credibility of annual planning and budgeting, as MDAs tend to bypass scrutiny in the regular budget process in favor of supplementary budgets, which allow for post facto approval of additional expenses by Parliament. PBO also highlights that some expenses listed in supplementary budgets could have been included in the original budget, citing the example of the Ministry of Education’s request for Ksh1.5 billion to purchase land in Ruaraka.
In September 2023, Controller of Budget Margaret Nyakang’o raised objections to 18 MDAs requesting Ksh15.27 billion for various projects just two months after the approval of the annual budget estimates. The Controller of Budget expressed concerns about the timing of these requests and the need for more thorough scrutiny and planning in budgeting processes.
Economists at the Parliamentary Budget Office believe that the government must adopt a practical and efficient approach to fiscal consolidation to address the country’s economic challenges. By limiting supplementary expenditures to unforeseen emergencies, the government can ensure that scarce resources are allocated wisely and that efforts to control debt and promote economic growth are not compromised.
In conclusion, the proposed restrictions on supplementary budgets by the Treasury are aimed at promoting fiscal responsibility, transparency, and efficient use of public resources in Kenya. By limiting additional spending to exceptional cases, the government can better manage its finances and prioritize essential needs while working towards sustainable economic growth.
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