MPs have rejected a bid by the Treasury to empower the Public Debt Management Office (PDMO) to provide legislators with advisory services on debt affairs in Kenya.
Last week, MPs adopted a report by the Public Debt and Privatisation Committee, which deleted two clauses from the Public Finance Management (Amendment) Bill 2023, denying the PDMO new advisory powers on public debt.
In its report, the House committee rejected changes that would have seen the debt office advise Parliament on the maintenance of public debt and financial obligations attendant to loans raised or guaranteed and securities issued or guaranteed.
The Bill had envisioned that the PDMO should offer its advisory on debt affairs before their approval by Parliament.
“The amendment (the deletion), aims to safeguard the oversight role of Parliament as provided in the constitution,” said the committee.
In observations made during the public participation stage, the public debt committee said the PDMO does not have jurisdiction to advise Parliament on debt matters and that it can only advise the Treasury Cabinet Secretary who is accountable to Parliament for the work of the debt office.
Equally, the MPs shelved an additional clause, which would hand the PDMO a new function in advising Parliament and the Treasury Cabinet secretary on the sustainable levels of public debt and the annual borrowing limit.
The Public Finance Management Act 2012 lists the PDMO’s primary function as carrying out the government’s debt management policy of minimising its financing cost over the long-term taking account of risk.
With the quashing of the new proposals, the PDMO which is headed by Dr Haron Sirima, will retain limited functions, which broadly capture the preparation of key documents.
