Government ministries, departments and agencies spent a total of Sh82.2 billion on development projects and programmes, compared to Sh93 billion in the same period of the 2016/17 fiscal year.
The total development allocation in the budget for the fiscal year is set at Sh642.9 billion, meaning that by the end of the first quarter ministries were expected to have spent Sh160.7 billion.
Delays by Treasury in releasing funds is one of the reasons cited for the slow absorption.
Kenya’s development spending fell by Sh11 billion in the first three months of the 2017/18 fiscal year, reflecting reduced activity in the economy amid electoral politics.
The latest report of the Office of the Controller of Budget covering between July and September 2017 shows that government ministries, departments and agencies spent a total of Sh82.2 billion on development projects and programmes, compared to Sh93 billion in the same period of the 2016/17 fiscal year.
The total development allocation in the budget for the fiscal year is set at Sh642.9 billion, meaning that by the end of the first quarter ministries were expected to have spent Sh160.7 billion.
“Development expenditure was Sh82.2 billion representing an absorption rate of 12.8 per cent, a decline in absolute terms compared to Sh93 billion spent in the same period of the fiscal year 2016/17,” reads the report in part.
Although the amount spent fell in absolute terms, the absorption rate improved year on year, having stood at 11.3 per cent in the first quarter of 2016/17.
Recurrent expenditure was up in absolute terms by Sh11 billion to hit Sh301.3 billion, even though the absorption level at 17.8 per cent was lower than the 21 per cent recorded in the previous year. The total allocation for the fiscal year stands at Sh1.69 trillion.
The Controller of Budget attributed the poor budget performance to a number of factors, including delays in releasing funds for development activities by The Treasury and shortfall in revenue collection.
“There was also delay in submission of quarterly expenditure reports by some ministries, departments and agencies to the Office of the Controller of Budget, which affected timely preparation of Budget Implementation Review Reports,” the report says.
On revenue collection, the government received Sh408.1 billion into the consolidated fund in the three month period, representing 18 per cent of its annual target which stands at just over Sh2.3 trillion.
In the 2016/17 fiscal year, the government had raised Sh459.6 billion at the end of the first quarter, meaning revenue performance fell by 11.2 per cent year-on-year.
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