The Treasury has freed up slightly more than Sh400 million after scrapping the budget for the refurbishment of public offices as part of expenditure cuts for the current financial year.
The budget document, tabled in the National Assembly for debate and approval later in the month, shows that Sh400.52 million initially earmarked for repairing cracks in the walls, re-painting, fixing ceilings, and plumbing works in public offices has been removed.
Refurbishment expenditures were the first casualty of President William Ruto’s austerity plans even before the explosion of youth-led protests over the dropped Finance Bill 2024 and elevated cost of living.
Former Treasury Cabinet secretary Njuguna Ndung’u had suspended “all refurbishments and partitioning of government offices” in his Budget Statement on June 13.
This was part of initial budget cuts which have since been deepened following deadly countrywide protests that prompted President Ruto to sack all his Cabinet secretaries, except Foreign Affairs’ Musalia Mudavadi who doubles up as Prime Cabinet Secretary. The budget for the purchase of furniture and new vehicles has also been scrapped, while that for renovation of buildings has been halved.
Some of the biggest casualties of the removed refurbishment budget include the State Law Office (Sh137.54 million), National Police Service Commission (Sh74.63 million), Judicial Service Commission (Sh29.50 million), and offices at the Senate (Sh28.61 million).
The demonstrations against new and higher taxes as well as elevated living costs have ripped up the Ruto administration’s initial plan to place the country on the path to achieving “a balanced budget by 2027” in a deal with the International Monetary Fund.
The administration was banking on the new taxes and expenditure cuts largely targeting non-essential expenditures such as hospitality and renovation of offices as well as slashing allocations for Semi-Autonomous Government Agencies to achieve its fiscal consolidation targets.
A balanced budget will mean keeping borrowing at bare minimal levels, something the country has failed to achieve in the past, including Dr Ruto’s first full financial year in power ended in June 2024 when debt continued to rise.
“It looks increasingly likely that the government will struggle to place public debt on a downward trajectory. The chances of a sovereign default in the coming years are rising again, and would jump if the IMF were to pull its support,” David Omojomolo, Africa economist for UK-based Capital Economics, wrote in a note last Friday.
“Debt servicing costs are now equivalent to close to 30 percent of government revenues. Meanwhile, the public appears to have grown increasingly distrustful of the government, especially as projects have been beset by delays or not materialised, all amid corruption allegations.”