Tough times as Kenya government promises to deepen austerity measures

By JAMES ANYANZWA

NAIROBI, KENYA: National Treasury has announced plans to extend its ambitious austerity measures beyond mere wage cuts as the Jubilee administration moves to fix the fortunes of an economy whose financial health has raised serious public debate.

But even as technocrats at the National Treasury spelt out ruthless cost cutting measures with strong determination to tax essential commodities and businesses to raise more revenues, the subject of wastage has remained a nightmare that gives them sleepless nights.

There was heated debate over an estimated Sh500 billion unaccounted public expenditure that the Standard Group attributed to the Auditor General in an exclusive interview.

However, this figure was based on an interim report whose findings are still being compiled and the amount was clarified as an estimate that is subject to review depending on final tallying of how much public offices have failed to account for.

Appearing before a parliamentary committee on Finance, planning and Trade Tuesday, Treasury Principal Secretary, Kamau Thugge, faulted the Auditor General for issuing erroneous figures and cautioned the public watchdog institution against using as material evidence.

“For sure, Mr Chairman that figure cannot be right. It means more than half of the revenues we collect disappeared,” said Thugge.

“I think we need to clarify that with the Auditor General. I’m going to have a meeting with him on the issue,” Thugge said.

Dr Thugge, however, declined to explain to the MPs the financial position of the country saying the government is looking into other areas of cutting costs including capping advertising costs by ministries, government departments, parastatals and other state-owned agencies.

He said a fund shall be created at the Central Bank dubbed transformative fund to hold savings realized from the Government’s austerity measures.

“We will be coming back with more austerity measures beyond the wage cuts, which will include centralising advertising programmes for all State owned entities,” he said.

The committee headed by Ainamoi MP Benjamin Langat noted that while the National Treasury is over zealous in revenue collection, very little is being done to seal loopholes for revenue loss and wastage.

“You (Treasury) seem to be over zealous when collection revenue, but very weak in accountability,” said Langat.

“The way things are we don’t see the Government as an institution that can provide development but a Government of wastage,” said Timothy Bosire, committee member and MP for Kitutu Masaba.