A Look At The New Budgetary Allocation; Winners And Losers

The State Department for Early Learning and Basic Education has seen its budgetary allocation reduce by 1.3 billion shillings to 99.5 billion shillings from the earlier revised allocation of 100.8 billion shillings.

The 1.3 percent decline was on account of a 27.9 percent decrease in the allocation to Quality Assurance and Standards to 3.1 billion shillings from the previously approved estimate of 4.3 billion shillings.

This was attributable to a 78.6 percent decrease in allocation for Curriculum Development to 0.3 billion shillings from the earlier approved estimate of 1.4 billion shillings.

The Ministry of Health has seen its budgetary allocation decline to 111.5 billion shillings from the earlier approved estimate of 111.7 billion shillings.

The 0.2 percent decline was on account of a 30.1 percent decline in allocation for Health Policy, Standards, and Regulations to 27.4 billion shillings from the previously approved estimate of 39.2 billion shillings. This was due to the Health Policy, Planning, and Financing department’s allocation declining by 43.9 percent to 12.9 billion shillings from the earlier approved estimate of 23.0 billion shillings.

The State Department of ICT’s budget has increased by 1.7 billion shillings to 21.7 billion shillings, from 20.0 billion shillings on account of a shortfall in personal emolument, ICT shared services, budget provision for the newly created office of Data Protection Commissioner, and increased donor commitments.

The creation of the Data Protection Commissioner office is partly attributable to the 29.5 percent increase in general administration planning and support services for the docket to 299.1 million shillings from 230.9 million shillings. The E-Government services docket also received a 4.2 percent increase to 2.5 billion shillings from 2.4 billion shillings on account of increased use of online services during the pandemic.

The Ministry of Energy’s docket has seen its budget record the highest rise, increasing by 12.3 billion shillings to 84.8 billion shillings from the approved estimate of 72.5 billion shillings on account of increased donor commitments and additional funding for flagship transmission lines.

This is in line with the government’s last-mile connectivity initiative which aims to provide electrical connectivity to individuals in marginalized areas.

It is key to note that the 17.0 percent increased allocation for the Ministry of Energy means that special approval will be needed for the expenditure adjustment in the docket since it is beyond the 10.0 percent threshold in accordance with the Public Finance Management Regulations.

Allocation to power generation and power transmission and distribution are the notable gainers, increasing by 43.3 percent and 15.8 percent respectively to improve availability and access to electricity.

In a bid to enhance food security, the State Department for Crop Development and Agricultural Research has seen its allocation increase by 7.8 billion to 49.6 billion shillings from the approved estimate of 41.8 billion shillings.

The 18.7 percent increase, which is the highest percentage increase, is on account of the 29.4 percent increase in allocation to Crop Development and Management, coupled with the settlement of pending bills under the Maize Subsidy Programme, implementation of Emergency Locust Response Project, Pyrethrum Industry Recovery, Miraa Industry Revitalization Project and Embryo Transfer Project, which are aimed at increasing agricultural output and creating employment.

The 18.7 percent increase in the agricultural docket will also need special approval since it exceeds the 10.0 percent threshold in accordance with the Public Finance Management Regulations.

Consolidated fund services have seen a 4.4 percent increase to 1,037.7 billion shillings from the earlier approved estimate of 1,028.0 billion shillings.

Interest and redemptions increased by 53.7 billion shillings to 958.4 billion shillings from the previously approved estimate of 904.7 billion shillings while pension has seen an 8.1 billion shillings decline to 111.1 billion shillings from the earlier approved estimate of 119.2 billion shillings.

External interest payments declined by 31.6 billion shillings to 340.0 billion shillings from the earlier approved estimate of 308.4 billion shillings, attributable to suspended interest payments for bilateral debt lenders from the Paris Club, which was partly attributable to the 1.0 percent decline in total interest payments to 458.7 billion shillings from the earlier approved estimate of 463.1 billion shillings.

Total interest and redemption, however, recorded a 5.9 percent increase to Kshs 958.4 bn from an earlier approved estimate of 904.7 billion shillings.

Key to note, interest on external debt declined by 23.3 percent to 118.7 billion shillings from 154.7 billion shillings, with a notable decline of 28.4 percent in interest payments owed to Exim Bank of China to 21.4 billion shillings from the earlier approved estimate of 29.9 billion shillings.