Inside Treasury’s 2020/2021 Ksh.2.91 trillion budget


Inside Treasury’s 2020/2021 Ksh.2.91 trillion budget

In Summary

  • The submissions contained in the 2020 Budget Policy Statement published last week are on the back of the Planning Ministry tweaking to the fiscal framework to accommodate the government’s much needed spending cuts.
  • To fund the narrowed budget, the National Treasury is betting on domestic revenue mobilization efforts to top Ksh.2.1 trillion to include Ksh.1.856 trillion in ordinary revenue collections by the KRA and Ksh.277.4 billion in ministerial aid collections.
  • The remainder of the Ksh.571.2 billion deficit is expected to be settled through net foreign and domestic financing estimated at Ksh.345.2 billion and Ksh.222.9 billion respectively.

The National Treasury has presented spending estimates totaling Ksh.2.91 trillion to the National Assembly for approval ahead of the commencing of the 2020/21 fiscal year.

The submissions contained in the 2020 Budget Policy Statement published last week are on the back of the Planning Ministry’s tweaking of the fiscal framework to accommodate the government’s much needed spending cuts.

As such the final spending estimates are slightly lower than the present Ksh.3 trillion budget approved in December’s first supplementary budget.

The National Government sees the sharpest decline in allocations to Ksh.1.83 trillion from Ksh.2 trillion in the 2019/20 financial year with all of the Executive, Judiciary and Parliament seeing cuts to appropriations to Ksh.1.78 trillion, Ksh.18.1 billion and Ksh.36.2 billion respectively.

County governments are meanwhile set to receive a total of Ksh.375 billion with Ksh.316.5 billion representing allocations from the national government’s equitable share.

Ksh.763.2 billion has meanwhile been set aside for government payments under the Consolidated Fund Services (CFS) including debt repayments amounting to Ksh.174.1 billion and Ksh.456 billion in principal and interest settlements respectively.

To fund the narrowed budget, the National Treasury is betting on domestic revenue mobilization efforts to top Ksh.2.1 trillion to include Ksh.1.856 trillion in ordinary revenue collections by the Kenya Revenue Authority (KRA) and Ksh.277.4 billion in ministerial aid collections.

The budget deficit meanwhile narrows to Ksh.614.1 billion exclusive of grants which are expected to come in at Ksh.46.8 billion.

The remainder of the Ksh.571.2 billion deficit is expected to be settled through net foreign and domestic financing estimated at Ksh.345.2 billion and Ksh.222.9 billion respectively.

Other domestic borrowing sources are meanwhile expected to yield in Ksh.3.2 billion worth of additional funds in the year to June 2021.

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Story By Kepha Muiruri
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