Budget calendar for the 2022-23 financial year draws to a close

Former National Treasury CS Ukur Yatani (left) share a light moment with immediate former National Assembly Majority Leader and former Finance minister Amos Kimunya at the Parliament buildings, Nairobi before he presented the 2022/23 budget. [Elvis Ogina, Standard] The budget-making process starts almost immediately after the commencement of the financial year on July 1. The process that is steered by the National Treasury and later on ropes in the National Assembly and Kenyans through a public participation phase is similar at the county levels, where the County Executive Committee (CEC) members for finance take charge of the process. It also involves the county assemblies as well as county residents. By August 30, the National Treasury cabinet secretary (CS) is expected to have issued a circular advising all government departments on how to prepare their budget requests for the next financial year. "This is the first major event in the budget calendar. The Cabinet Secretary and the County Executive Member for Finance at the national and county levels respectively must issue a circular to all government departments advising them on how to prepare their budget requests for the year," said the International Budget Partnership (IBP) Kenya in an explanatory note on Kenya's budget making process. "The circular should also contain the budget formulation calendar for the year, including opportunities for public participation." Cabinet approval The National Treasury is then required to develop the Budget Review and Outlook Paper (Brop) and submit it to the Cabinet for approval by September 30. Brop shows the actual expenditure in the previous financial year and projects for the coming year. The Public Finance Management Act (2012) requires the Cabinet to consider and approve the Brop within 14 days. Treasury is then required to table the document in the National Assembly within seven days of the Cabinet approving it. This means it should be tabled by October 21. "These documents serve three purposes: they review the previous year's budget performance (year-end review), they update current year economic expectations (for inflation, growth etc), and propose a distribution of the coming year's budget across key sectors like health and education. (This distribution is known as the "provisional ceilings" for each sector)," said IBP Kenya. Treasury then commences the preparation of the annual Budget Policy Statement (BPS) that it takes to the Cabinet and upon approval, it is tabled in Parliament by February 15. "In preparing the BPS, the National Treasury shall set out the broad strategic priorities and policy goals that will guide the national government and county governments in preparing their budgets both for the following financial year and over the medium term," reads the PFM Act. The Act further directs Treasury to include an assessment of the current state of the economy and the financial outlook over the medium term. Proposed expenditure This is an outlook of government revenues, expenditure and borrowings both for the next financial and in the medium term as well as the proposed expenditure limits for the national government, including those of Parliament and the Judiciary and indicative transfers to county governments. Also due in February are recommendations by the Commission on Revenue Allocation (CRA) for how much should be distributed to each level of government (national and county) through the annual division of revenue process. "These recommendations are meant to inform the Division of Revenue and County Allocation of Revenue Bills tabled annually in Parliament by February 15," said IBP Kenya. The National Treasury CS is also required to submit to Parliament the country's debt management strategy over the medium term by February 15 of each year. The strategy shows Kenya's source of loans, the risks associated with the loans and guarantees as well as an analysis of the sustainability of the amount of debt. The national budget estimates are tabled by April 30 in the National Assembly. "At this stage, the total budget and sector distribution should not be changed, but funds may be moved around between programs," said IBP Kenya. The Finance Bill - which sets out the revenue-raising measures for the Government - should also be tabled before Parliament on or before April 30. The National Assembly undertakes public hearings on the budget estimates in May. Treasury CS presents the Budget Statement in Parliament highlighting the revenue-raising measures for the national government. This is usually in mid-June. This year's statement is set to be read in Parliament on June 15. June 30 marks the end of the financial year. "By this date, the Appropriation Bills should be approved by the National Assembly. These bills authorise the government to spend against the budget from July 1," said IBP Kenya.

Budget calendar for the 2022-23 financial year draws to a close

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Budget calendar for the 2022-23 financial year draws to a close

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