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Budget: MPs resist Uhuru's new plot

BUSINESS
By | June 10th 2011

By Standard Team

A Government Motion preceding the Budget committee’s scrutiny of the financial estimates caused uproar in the House, with MPs protesting it was in breach of procedure.

Members who persistently questioned Deputy Speaker Farah Maalim’s ruling on the matter put him on the spot for sanctioning the Motion.

Finance Minister Uhuru Kenyatta moved the Motion requiring "that the financial statement and all the other documents tabled on Wednesday for fiscal year 2011/2012 be referred to the Budget committee, prompting protests.

Backbenchers opposed the Motion, arguing it was a waste of time since the estimates had been committed to the Budget committee, which would submit a report to the House for debate. They added the debate would run down the clock, because there are only three allotted days to discuss the Budget.

Despite spirited attempts by MPs Martha Karua (Gichugu), Martin Ogindo (Rangwe), Gitobu Imayara (Imenti Central), and Bonny Khalwale (Ikolomani) Deputy Speaker Farah Maalim ruled the Motion would proceed, but with an amendment.

He directed Uhuru to amend the Motion to exclude the financial estimates from discussions to avoid duplicity. The amended Motion thus made reference to the Budget speech Uhuru read to Parliament, estimates of revenue, and the Finance Bill.

Maalim said the Executive had a right to move the Motion to, among others, explain how the estimates of recurrent and development expenditure were arrived at.

Karua said the Constitution provides that the Cabinet Secretary responsible for Finance appears before the committee to give such an account.

She said despite the impressive growth flaunted by the Government its fruits did not trickle down to Kenyans.

"Those in the periphery are asking whose economy? In North Eastern the people are hungry the situation is dire," Karua said.

The former Justice Minister said it is escapist to only blame the skyrocketing consumer prices on rising international prices of crude oil.

"The other factors are corruption, insider trading, cartels that operate with full knowledge of authorities of which some members of Executive are part," said Karua.

She added: "We want full evaluation of this sector. Good governance is what we must invest in; that is what is causing suffering."

Karua questioned how funds voted in the supplementary Budget were used saying the greatest concerns facing Kenyans are health, hunger, and education.

Insufficient funds

Meanwhile, it emerged yesterday that Uhuru did not allocate sufficient funds for the implementation of the Constitution and the expansion of the Jomo Kenyatta International Airport (JKIA).

Financial analysts PriceWaterhouseCoopers (PwC) said in their post-Budget press conference that Sh20 billion allocated for implementation of the Constitution is not enough. They said there is also nothing provided for the expansion of JKIA and the port of Mombasa.

"There was nothing allocated for the expansion of airports, the expansion of the port to alleviate the problem of clearing of goods at Mombasa port and the construction of a new port at Lamu," said Kuria Muchiri, a country senior partner, PwC.

But the biggest fear was the concern that this year’s Budget may not have allocated enough resources for full implementation of the new Constitution.

With less than five of the necessary 30 laws already passed by Parliament, this leaves a significant implementation agenda to be completed in a fairly short time.

This year’s Budget provides Sh20.8 billion for implementation of the Constitution.

"It is possible the Budget does not include a strong commitment to ensuring successful 2012 General Election or the devolution of power to the counties," said Muchiri.

Apart from hiring more judges of the High Court, the Court of Appeal, and recruiting new ones for the Supreme Court, the Government is expected to pay members of the yet-to-be established Judges and Magistrates Vetting Board, among its membership three foreigners.

To make the new judicial offices operational, the Government is expected to provide salaries, new courts, transport and housing for the new officers, all requiring huge sums of money.

While most of the devolution laws were expected to be enacted within one or two years after the promulgation date, very little has been done, either because of legislative backlog or lack of funding, and nothing has been heard from the Commission on Revenue Allocation chaired by Micah Cheserem since it was appointed.

Experts say there is no specific allocation for establishment of structures and capacity building ahead of the 2012 General Election.

"This figure is not enough, given the amount of work that is to be done within the time left," said Alphan Njeru, a partner at PwC Kenya.

Expenditures

For instance, there are immediate constitution-related expenditures, including the setting up of constitutional offices, drafting new laws, judicial reforms, setting up structures of devolved governance, capacity building, and establishment of a new public finance mechanism.

"We still do not have a law to safeguard resources at the county level. The various devolved Government structures are still not in place and it is not unclear whether donors will assist in implementation of the Constitution," said Njeru.

If implementation of the Constitution- related legislation is not enacted soon, this is also likely to affect preparation for the 2012 elections.

There are fears that the Sh5 billion allocated in this year’s Budget for preparing the polls is also not adequate.

"There is need to undertake a massive voter education before 2012. This is because most people are still not aware of how the devolved system of Government will work or duties and roles of such individuals as governors, senators and MPs," said Eliud Moyi, a research analyst at the Kenya Institute of Public Policy Research and Analysis.

While Finance Minister Uhuru Kenyatta increased allocation to infrastructure-related projects to Sh221 billion, an increase of 34 per cent from the previous 2010/2011 fiscal year there was no mention of airports or ports

In his Budget speech, Uhuru said these financial resources would be spent on roads, energy and railways. Interestingly, the Budget did not provide any allocations to ports and airports, especially the congested port of Mombasa or the yet-to-be built Lamu port. It was also silent on upgrade of JKIA, East Africa’s largest air transport facility.

Although Sh100 billion was allocated for construction of roads, there are doubts on whether all these funds would be used.

"We have capacity concerns, especially in the construction of rural roads being financed using constituency development funds," said Muchiri.

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