Uhuru, Ruto surpassed budget by Sh5 billion during transition, elections


President William Ruto. PHOTO | SILA KIPLAGAT | NMG 

Retired President Uhuru Kenyatta and his successor, William Ruto, exceeded by Sh5.01 billion their office budget for three months through September, when the transition of power took place in Kenya.

Treasury data show expenditure by the executive office of the President spent nearly double the amount that had been targeted for the quarter, with most of the over-expenditure going into recurrent expenses.

The spending of the Presidency, which supports offices of the President and his deputy, stood at Sh10.78 billion against a target of Sh5.77 billion, according to the latest expenditure disclosures by the Treasury.

The Treasury did not disclose the reasons behind the budget burst that happened in the quarter that ended two weeks before Dr Ruto was sworn in as Kenya’s fifth president.

The spending spree in the Presidency also came in a period when Dr Ruto and Mr Kenyatta sought to outdo each other at the August 9 presidential elections.

Although Dr Ruto was the incumbent Deputy President, Mr Kenyatta threw his weight behind opposition leader Raila Odinga, triggering a vicious campaign for the top job.

The recurrent budget for the office, including operations and maintenance, more than doubled the target of Sh4.27 billion for the quarter to September to nearly Sh8.90 billion.

The cost of running the government — including salaries, operation and maintenance costs— overshot the target by Sh57.03 billion to Sh573.29 billion.

“The over expenditure in the recurrent category was mainly due to higher than targeted expenditures in operations and maintenance,” the Treasury wrote in the provisional expenditure and budget review report for the first quarter of the current year ending June 2023.

The operation and maintenance costs in the three-month period exceeded the budget by Sh92.95 billion, the Treasury says, after the expenses hit Sh260.67 billion.

The above-target budget will put the new administration of President Ruto on the back foot against the backdrop of a plan to slash the full-year recurrent expenditure by at least a quarter in a bid to ease pressure on public borrowing.

Dr Ruto has directed the Treasury to work with other ministries to reduce the nearly Sh1.18 trillion recurrent budget for this fiscal year by at least Sh300 billion.

The plan, he says, will reduce the need to borrow Sh862.5 billion to plug the hole in the Sh3.3 trillion budget for this financial year ending June 2023.

The savings from what promises to be the deepest and most brutal budget cuts in decades will ease the pressure to borrow.

The Treasury spent Sh23 billion without the approval of Parliament in the weeks leading up to the inauguration of Dr Ruto.

Documents tabled in Parliament earlier showed the Treasury made disbursements for, among others, the maize flour and fuel subsidies, the purchase of Telkom Kenya shares and the building of a military research hospital.

It disbursed Sh810 million to the State House, Sh2.2 billion for building the military research hospital, and Sh4.5 billion for the discontinued maize flour subsidy.

Another Sh9.45 billion was allocated for road construction and Sh6 billion for the purchase of a 60 per cent stake in Telkom Kenya from Helios Investment Partners, making the company fully State-owned.

The Constitution requires the Treasury to table a mini-budget two months after withdrawing funds from the Consolidated Fund without the approval of MPs—whose term ended on June 9.

“Already the Treasury has invoked Article 223 of the Constitution that allows them to spend money without the approval of Parliament. They have approved the withdrawal of Sh45.67 billion out of which Sh23 billion has been paid out,” Martin Masinde, the acting director of the Parliamentary Budget Office (PBO), told MPs earlier.

“This is coming just two months into the new financial year. They now want Parliament to regularise the expenditure, including salaries, which is not an unforeseen expenditure.”

The proposed budget cuts are largely targeting less essential expenditure on items such as domestic and foreign travel, entertainment, training and publicity.

Other budgets set to be chalked off are gifts, flowers and tea in government offices.

The cuts will accompany a freeze in hiring and salary increases for public servants, which may go against the new administration’s campaign pledge to improve the pay for security workers such as police officers.

“We intend to contain growth in non-priority expenditures so as to reduce the fiscal deficit that will support a reduction in the growth of public debt to ensure sustainability,” Treasury Cabinet Secretary Njuguna Ndung’u said on November 10.

“The [fiscal consolidation] policy’s main objective is to free resources to growth-enhancing programmes by gradually reducing the overall fiscal deficit and the pace of debt accumulation.”

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