The National Treasury announced the 2019/2020 national budget. The budget has so far received criticism from the majority of quarters within and without government.
The 2019/2020 budget is in deficit of more than 600 billion shillings. According to the National Treasury, the deficit is to be funded through both domestic and foreign borrowing.
Kenya’s debt continues to balloon. Currently, the public debt is beyond the 5.6 trillion shilling mark accounting for almost 56 percent of Kenya’s GDP.
The bulk of Kenya’s debt is from China which among other thing, financed the construction of the Standard Gauge Railway (SGR) from Mombasa to Nairobi.
It is said that the Port of Mombasa might have been used as collateral for the SGR loan taken from the Exim Bank of China.
What is worrying is, the budget of Kenya was more than that of Tanzania, Uganda and Rwanda combined.
Kenya’s budget is what can be described as the Budget of Plunder, where the majority poor population is heavily taxed to sustain the lifestyle of the status quo.
More than 60 percent of Kenya’s budget goes to recurrent expenditure such as paying salaries and allowances to government officials. Very little trickles down to funding economic projects.
The Kenya Revenue Authority, has over the years failed to hit the revenue collection target. They barely manage 1 trillion shillings annually leaving the country with a hole to always be filled with borrowing.
This is what happens with the Kenyan government; KRA can manage say 1.5 trillion shillings, this plus reserves bring the amount to roughly 2 trillion shillings. The government comes up with a budget higher than the amount they have at hand.
The problem with the Kenyan government is not the budget but failure to plan. They have failed to effectively plan for the little they have and transferred the weight to the taxpayer.
Corruption is another greatest impediment to the economy of this country. At least one trillion shillings are lost annually to corruption. That is a third of the national budget. This means the Kenyan economy can function effectively with a budget of 2 trillion shillings without corruption.