State’s Sh930 billion Covid plan good but make every coin count

The government has put together a Sh930 billion war chest to fight the adverse effects of the Covid-19 pandemic.

In a new Post-Covid-19 Economic Recovery Strategy (ERS), the government estimates that in the next two financial years, this money will be used to stimulate the ailing economy.

Kenyans expect nothing but better utilisation of these funds. We know this money will not come by easily. Taxpayers might have to pay heavily for these funds in the form of increased taxes.

Already, National Treasury Cabinet Secretary Ukur Yatani has indicated that the government will roll back the tax relief measures that had been implemented to cushion individuals and businesses against the pandemic, by the end of this year.

Value added tax will revert back to 16 per cent from 14 per cent while pay as you earn (Paye) for workers and corporate income taxes for businesses will go back to 30 per cent from 25 per cent.

Moreover, the government intends to eliminate several tax exemptions with the aim of consolidating as much as Sh500 billion from high net worth individuals and businesses that have been enjoying tax holidays.

There are also plans to crowd-in the private sector to participate in a number of public projects, including infrastructure and housing, through the public private partnerships. This might see the return of toll fees for use of some of the roads that will be financed by the private sector.

The State also plans to prevail upon pension funds and insurance companies to defer interest payment on government securities as it targets Sh73 billion in savings. This might hurt some pension schemes with tight liquidity, translating into poor pension earnings for some senior citizens.

But the government says it wants to put these in areas that will help tackle the health and economic effects of the pandemic. Farmers, teachers, small traders, healthcare workers, horticulturists and tour operators are some of the people that are supposed to benefit from this kitty.

The elderly, persons with disabilities and people in slums who have lost their jobs will also benefit through monthly stipends, even as studies show that Covid-19 pushed close to two million people into poverty.

The health effects of the pandemic will be addressed by recruiting 5,000 additional diploma and certificate level healthcare workers, expanding bed capacity in public hospitals through supply of locally sourced beds and bedding and purchasing additional oxygen cylinders with oxygen and accessories.

The government also intends to establish 50 modern walk-through sanitisers at border points and main hospitals across the country. These are nice plans on paper that Kenyans have wearily become accustomed to.

But this time round, it should be different. It should be different because this is a crisis like no other. Failure is not an option.

The stark reality speaks for itself. By yesterday, Kenya had recorded 82,605 Covid-19 cases, with 1,445 deaths. Health officials are warning that the numbers could climb more than had been anticipated.

What a travesty it will be if we allowed corruption that has come to characterise public procurement to compromise this war? Hundreds of people have lost their lives. Millions have lost their livelihoods and a lot is at stake.

That is why we urge for prudence in the handling of Sh930 billion agenda. Priority should be in putting this money in viable projects that will help the economy to recover fast - not luxuries like mandazi and tea.

It is not lost on Kenyans that in the past there have been very viable government projects that collapsed because of corruption. This money too might go down the drains. Job losses will continue and our healthcare system will be overwhelmed.

We laud the gains so far in the Covid war. President Kenyatta’s recent decision to revise Covid protocols was timely. The police have done a good job in enforcing regulations.

Kenyans can keep the hope of a better tomorrow by doing the right thing even in the middle of the pandemic. At this point in time, we will exhibit lack of foresight if we drop our vigilance and sense of personal responsibility.