Development budget suffers more cuts to pay striking employees

Mutava Musyimi. (Photo: Courtesy)

Striking doctors and lecturers’ salaries, emergency funding for drought and allocations for the August polls will push up recurrent spending in the current budget.

The supplementary budget tabled in Parliament yesterday adds Sh6.9 billion to mitigate against the biting drought effects and besides offering Sh4.8 billion each to address wage demands by striking doctors and lecturers.

The National Intelligence office will also be allocated Sh2.5 billion, while Kenya Defence Forces will receive Sh2 billion and the Independent and Electoral Boundaries Commission Sh2.2 billion to repatriate the refugees. The Kenya Roads board is allocated an additional Sh20.8 billion.

“The total recurrent estimates are set to increase by Sh61.6 billion, with the bulk of the funding to cater for drought mitigation, collective bargaining agreements due to labour unrests and security matter,” a report by the Mutava Musyimi led Budget and Appropriations Committee tabled yesterday read in part.

The money will, however, be diverted from development spend, which was slashed further for the second time. Finance Cabinet Secretary Henry Rotich had earlier on scaled it down by Sh181 billion by reducing development spend by Sh213 billion, while increasing recurrent expenditure by Sh32 billion.

Yesterday, the parliamentary committee tabled proposals to cut expenditure by Sh65.6 billion, which puts the total reduction in this year’s budget at Sh278.6 billion.

However, at the same time, recurrent expenditure which mainly comprises of salaries has been added Sh61.6 billion making a total addition to the recurrent spends at Sh93 billion from Rotich’s earlier proposals

The cut on development, according to the committee, was necessary due to the lower commitment from donors. At the end of first-half of the current financial year, the Government had only received 22.7 per cent of the total grants expected, while external loans received were only 12.7 per cent.

Energy, infrastructure and ICT were the biggest casualties of the latest funding cuts.

The Government has been dragging its feet on development expenditure. Out of the Sh824.3 billion that had been released from the exchequer, just Sh137.9 billion was for development, while recurrent took Sh345.2 billion.

This means that for every Sh100,000 released for development, recurrent expenditure was receiving at least Sh250,000.

In the new proposals by Parliament, the ministries of Interior, Health and Infrastructure have all lost Sh6.7 billion, while some less priority projects have had their funds diverted.

According to recommendations tabled by the Committee, money meant for the construction of rural roads have been scrapped putting in to question the Government’s ability to deliver on its 10,000 kilometre promise.

“Mr Speaker, the committee proposes reduction of Sh5 billion from the development estimates of the State Department for Infrastructure under the ‘Road Transport Programme’ meant for low volume seal roads,” the Budget Committee report read in part.

Another casualty was the fund for running specialised equipment in 96 hospitals that have been fitted with renal, X-rays, theatre and mammogram services under the Managed Equipment Services (MES) Project.

The budget committee slashed their budget by Sh1.7 billion under the health ministry.

Money meant for operation expenses at the General Service Unit headquarters has also been trimmed by Sh21.7 million.

In energy, Sh500 million has been stripped from electricity connectivity subsidy, while Sh100 million meant for installation of transformers in constituencies has also been taken out of the mini budget.