Treasury set to table ‘austerity’ budget next week

James Momanyi @jamomanyi

The National Treasury will next week table in Parliament the second supplementary budget that will introduce austerity measures for national and county governments to cure the expected budget deficit of Sh84 billion this financial year.

While allaying fears that the government is broke as reported in a section of the media yesterday, Treasury Cabinet secretary Henry Rotich said that the budget deficit is a normal occurrence and should not be mistaken for budget crisis.

“Our budget has a deficit every year. I presented a budget that had a deficit of 7.2 per cent that was to be filled by borrowing as compared to 8.8 per cent the previous financial year. Every year there is a deficit and when I spoke in Parliament, I did not say that the government is broke,” Rotich said is response to media reports that the government has run bankrupt.

The CS said his ministry will do a proposal to slash the expenditures of both the national and county government through the introduction of austerity measures that will affect operational budgetary allocation like travel, entertainment and some development projects that can await allocation in the next financial year (2018/19).

“The austerity measures will cut across the two levels of government. There is no point for the national government to squeeze its budget while the county governments are living large. We are doing that, unlike the previous years, because of the uniqueness of the first half of this financial year.

The revenues are not forthcoming because of protracted electioneering. In fact, we had two elections this financial year, which is different from the previous year,” said Rotich. “If revenues are not coming in there is nothing that I can do but that does not mean that the government is broke.”

The Treasury boss further said that the austerity measures will be contained in the second supplementary budget for 2017/18, which will be tabled in the National Assembly next week when it resumes sittings after a short induction recess.

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