How Henry Rotich's new measures could save your coin

Kenya: The National Treasury has announced a raft of measures to contain wastage in ministries and State agencies. It has also cut expenditure on travel for State officials, hospitality and advertisement.

 Cabinet Secretary National Treasury Henry Rotich in 2014/15 Budget Speech said the Government will also cut transfers to semi-autonomous. The thinking is that these agencies should be self-sustaining.

 The funds will instead be re-allocated to priority areas such as capital spending. This appears to give authority to a circular issued early this year that directed ministries, departments and State agencies to cut wasteful spending.

“As part of efforts to combat waste, the budget allocations for consultancy services, travel and hospitality have been curtailed, which will contribute to savings going forward,” said Rotich, in the Budget Speech 2014/15. 

 The Government will restrict foreign travel to essential travel with limited number of staff and controlled use of business class.

On advertising, Treasury says it will centralise advertising with a view to better manage cost.

The aim is to save more than Sh13 billion from these measures.

 However, a directive for ministries to use government facilities rather than private venues for meetings was recently revoked by President Uhuru Kenyatta to stimulate local tourism.

“Government has, with immediate effect, revoked the National Treasury Circular restricting the public service from holding conferences and other meetings in private hotels. It will now be possible for the public sector to hold conferences and meetings in private hotels throughout the country as and when the need arises,” the President said.

The Auditor General Office recently said that a third of the budget cannot be accounted for and called for oversight to curb wastage in ministries and agencies.

As much as Sh500 billion State cash could have been squandered or cannot be accounted for since 2012. That was the shocking revelation early this year by Auditor-General, Dr Edward Ouko, whose work is to keep track of Government spending to ensure taxes and other revenues the State generates is neither stolen nor misused, and that the spenders account for it to the last penny.

Ouko raised the red flag over continued plunder and discrepancies in the national book in his yet-to-be-released report for the fiscal year 2012/13.

A report released by the Controller of Budget in February revealed that 45.1 per cent of the recurrent budget was spent on operations and maintenance activities. And an analysis on the expenditure on the operations and maintenance between July and December 2013 shows that Sh1 billion was spent on foreign travel, Sh813.6 million on domestic travel, Sh605.7 million on training, Sh593.5 million on hospitality, conferences and catering services.

Shocking revelation

Also, Sh92.4 billion was spent on other recurrent expenditure such as electricity, publishing and printing services.

To reduce this wastage and entrench efficiency, the Government is set to rollout e-procurement by making operational the Procure-to-pay module of the integrated Financial Management System (IFMIS).

“All government procurement will be done electronically, and the days of inflated prices will be a thing of the past,” he said.

Rotich said the Government will develop and enforce cost benchmarks for all projects and consumables to ensure value for money.