Treasury Budget Deficit Widens As The Economy Bites

Treasury Calls for Amendment of National Public Debt Regulation

The National Treasury will have to raise KSh607 billion to seal the budget gap for the financial year 2019/2020. The budget deficit amount has gone up KSh31 billion from KSh576 budget gap in 2018/2019.

According to information from the parliamentary budget office, KSh324 billion will be raised from external sources while KSh289 billion will be raised from domestic sources.

The Parliamentary Budget Office has disputed the KSh607 billion budget deficit, claiming that the deficit should be higher if adjustments are factored in. The agency says that treasury is hiding the true figure as per an article by the Daily Nation. The PBO also notes that the 2019/2020 budget has surpassed the Budget ceiling set by MPs by KSh78 billion.


Most of the money will go to the running of the government after Sh1.7 trillion was set aside for recurrent expenditure, which finances salaries, fuel for cars, stationery and refreshments.

The second biggest cost in the 2019/20 budget is repayment of debts and devolution. Treasury plans to spend Sh551 billion in interest payments for loans and pension. This is Sh61 billion more than the Sh490 billion this year.

Dam construction will cost the taxpayer another Sh25.1 billion this year, despite having received nothing from the billions spent in previous projects.

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Among the interventions is Sh2 billion set aside for the value chain support and Sh3 billion for the cherry coffee revolving fund.

The affordable housing program will get a total of Sh10.5 billion, while the manufacturing sector will receive Sh3.8 billion worth of interventions.

To plug the budget deficit, the Treasury says it will, once again, be seeking to pile up more debts.

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