Mutava team rejects request for Sh51bn budget increase

Parliament has rejected a bid by departmental committees to increase line ministries’ spending in the next financial year by Sh51 billion, saying it would burst the budget ceiling and plunge the country into economic chaos.

Mutava Musyimi, who chairs the National Assembly’s Budget and Appropriations Committee (BAC), said the additional expenditure requests would trigger instability and stifle growth.

“Accepting requests for additional financing as advanced through the various departmental committees would increase the national government’s overall budget deficit by Sh51 billion or 3.5 per cent of the GDP,” Mr Musyimi said after a consultative forum that brought together committee chairmen, the Treasury and Cabinet secretaries.

“This would have triggered inflation, disturb the stability we need for a strong currency and mess up the economy.”

Crucial government plans expected to suffer serious setbacks in the wake of Parliament’s action include the procurement of new ferries, the hiring of teachers and the construction and equipping of tertiary education and vocational training institutes (Tivets).

Mr Musyimi said the Interior ministry had also failed to convince MPs to allocate additional Sh7.7 billion it needed to lease Administration Police vehicles (Sh6.2 billion) and Sh1.5 billion to complete the construction of county administrative offices under the economic stimulus package (ESP).

Police medical equipment

The House also rejected the ministry’s request for an additional Sh5.5 billion for police medical equipment and Sh700 million to build a forensic laboratory for the police.

The Musyimi committee last week stood down debate of its report on reallocations of the 2015/16 budget as proposed by departmental committees to give room for mediation.

Departmental committee chairmen had complained that the Musyimi team had failed to incorporate their recommendations in the final report that the Treasury will use to craft the final expenditure plan for the financial year that starts in July.

The budget committee meets tomorrow to finalise its revised report that will be tabled in the House during Wednesday’s special sitting that will discuss the mediated version of the Division of Revenue Bill, 2015.

“There will be no adjustments. We cannot accept the Sh51 billion deficit. Teachers, Tivets and ferries were the issues I went to consult the President (Uhuru Kenyatta) about but the deficit would be too much,” Mr Musyimi said.

“Despite the problems we have with the ferries, teachers and others, we have to live with what we have. We can’t increase even a cent above ceilings the Treasury has set.”

The budget team also rejected the Ministry of Transport’s bid to secure Sh3.5 billion to finance the Kenya Airports Authority’s (KAA) Greenfields project.

The ministry also failed to convince the Treasury and BAC to provide Sh700 million to buy two new ferries. The money was to be hived off the allocation to the National Fund for Restorative Justice.

READ: Parliament warns of gaps in Treasury’s Sh2.2trn budget

The Land ministry’s request for Sh4 billion for completion of stalled projects under the Economic Stimulus Package was also rejected.

The Livestock Department, which sought Sh2.8 billion for the Agricultural Development Corporation’s (ADC) embryo transfer project, did not get the money either.

The request for additional Sh1 billion to save the ailing Kenya Meat Commission was also rejected.

The same fate befell the National Cereals and Produce Board’s request for Sh5 billion to finance fertiliser subsidy and purchase of food for the national strategic reserve.

The State Department for Water and Regional Development’s quest to have Sh2.34 billion allocated for integrated regional development also failed to go through.

Of the total amount requested by the department, Sh1 billion was to support the Lake Basin Development Authority and Sh200 million each for the setting up of a tannery by Ewaso Nyiro South Authority, Marsabit water piping and Eldas town piping.

The State Department for Science and Technology could not convince MPs to allocate it additional Sh3.5 billion for the construction and equipping of 70 new technical training institutes and refurbishment of old ones.

The Sports, Culture and Arts ministry unsuccessfully sought Sh1.2 billion for the National Museums of Kenya (Sh800 million), the Natural Products Industry (Sh200 million) and the National Heroes Council (Sh200 million).

The ministry also sought an additional Sh364 million for hosting major international sports events, Sh25 million for the anti-doping agency and Sh366.5 million for the office of registrar of sports. An increment of Sh200 million for the Kenya Film Commission was also rejected.