Unpredictably Henry Rotich, Finance Cabinet Secretary, read the Sh2.3 trillion budget on Wednesday, a day earlier than expected, so as to be in line with his counterparts in Uganda, Tanzania, Rwanda and Burundi.
And as expected, the budget was both ambitious and wishful. The budget was ambitious because it has risen from last year’s Sh2.2 trillion to Sh2.3 trillion and wishful because Kenya Revenue Authority (KRA) failed to meet last year’s collection target.
Yet, KRA is projected to raise Sh1.37 trillion from tax collections, Sh124.2 billion from appropriations in aid and Sh72.6 billion from grants. The financing gap will be plugged by borrowing Sh229.6 billion locally and Sh459.4 billion internationally.
Perhaps, in defence of the budgetary increase at a time of when Treasury was expected to announce how it intended to scale back public expenditure in line with the expected reduction in public borrowing from both the local and global financial markets, the Cabinet Secretary said the increased allocations were predicted on the back of a rising economy that is projected to grow at seven per cent during the next financial year.
While the jury is out on whether the economy can break into a canter, it is clear the rate of growth will be determined by how efficiently the budgetary allocations are utilised. In this regard, Treasury may consider PKF Eastern Africa Chief Executive Officer Atul Shah’s proposal to review the scope of work done by the Auditor General’s office with a view of sub-contracting some of it to the private sector.
The merit in the proposal is that it would increase the credibility of the audited reports because it would reduce the chance of collusion between those being audited and the auditors while also speeding them up. Producing audit reports in time would, in turn, increase the chances of re-possessing the funds looted. This would give the anti-corruption laws teeth.
Obviously, the country also needs—as a matter of urgency—to review the penalties sanctioned under the Economics Crimes Act and under the general penal code as they are currently so lenient that they do not serve as a deterrent. While analysts welcome the various initiatives Treasury has put in place to manage public resources better, including the publishing of new procurement laws, perhaps the most significant is the requirement that all government ministries, departments, agencies and semi-autonomous public companies set up audit committees to oversee all expenditure.
The requirement that these be recruited from outside the existing public service cadres and the regular rotation of finance personnel serving in government would serve as yet another way of safeguarding public resources.
But perhaps the complete digitalization of all procurement in national and county government is the silver bullet that would finally strike the dragon of corruption a lethal blow. The fight against the practice that has continually robbed the county hundreds of billions of shillings every year would be further boosted were Treasury to enlist the help of the Central Bureau of Statistics staff to collect the prices of all the major items bought by government.
Massive looting
This need not be an onerous or expensive exercise as major manufacturers would be willing to send the list electronically at no cost. Many a manufacturer also usually give a price guideline to their wholesalers and retailers. This data would then be stored in a master-computer to be used to track the prices quoted by various suppliers.
It does not take a rocket scienctist to understand that such a master-list would have proved invaluable in thwarting the massive looting at the National Youth Service.
State House may also be persuaded to fast-track the implementation of the Salaries and Remuneration Commission (SRC) report aimed at re-jigging the civil service to ensure that the right people are doing the jobs they are best qualified to do.
While it may be understandable that the State does not have the stomach for carrying out a major restructuring exercise that might lead to loss of jobs at this time when the General Election is only 14 months away, there is no excuse for not beginning the retraining of those identified next financial year.
