The Treasury shouldn't turn to costly foreign loans as Kenya seeks to plug a Sh862 billion budget hole for the year to June next year.
The implications of Kenya’s rapid accumulation of debt are stark. The rising repayments are draining the public purse and forcing higher taxes upon the already stretched taxpayer.
Therefore, the Treasury should consider other options before taking the path of seeking additional debt. There is room to cut non-essential expenditures such as travel, entertainment and training expenses, to rein in the fiscal deficit.
The three items gobble Sh88 billion. As well as runaway spending, the government has not been aggressive enough to stamp out widespread corruption as hundreds of billions of shillings in public funds are lost every year.
The taxman needs to bring more people into the tax brackets and curb tax cheats in the quest to meet revenue targets. Borrowing becomes a problem only when the monies borrowed are put in ventures that do not generate revenue or create jobs.
Therefore, the Treasury must consider spending cuts to ensure the country leaves within its means.
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Note: The results are not exact but very close to the actual.
