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Experts: Budget doesn't do enough

BUSINESS
By Moses Michira | June 19th 2020

Economic experts say the Budget unveiled by the Treasury is not enough to help Kenya navigate past the Covid-19 pandemic.

Treasury Cabinet Secretary Ukur Yatani presented the Budget to Parliament last week, stoking debate on whether the spending plans could have been better.

According to panellists in the FrontRow show broadcast by KTN on Tuesday, Yatani could have done better allocations.

David Ndii, an outspoken economist, said any interventions to support small and medium enterprises (SMEs) would be futile as long as the demand for their products remains depressed.

“Consumers have gone into survival mode and those who have not lost their income are only spending on the necessities, such as food, meaning that even if you stimulate SMEs, there will be no demand because we are not buying,” he said.

Ndii projected that Covid-19 would be around for at least the next three years, a period during which economic growth would shrink by about 40 per cent.

Former Mandera Senator Billow Kerrow said he was disappointed that Yatani’s spending plans did not “look like a corona budget, especially when you look at the expenditure”.

For instance, he said, Sh1.5 billion to support the horticulture sector was insufficient for an industry that is a critical source of foreign exchange.

“It is not what most of us expected. The government should have reduced its expenditure. The budget is not about taxing people,” Kerrow said.

Institute of Certified Public Accountants of Kenya Chairperson Rose Mwaura said there should have been bigger allocations to the healthcare sector to deal with the pandemic.

“The first one is to make sure that we have proper funding to the healthcare sector so that people can be treated and testing can be done,” she said.

 

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