Yeaterday two Senate committees voted to recommend that Kenya’s debt ceiling be increased to Sh9 trillion after adopting a proposal by the National Treasury to amend the Public Finance Management regulations.
The decision by the joint sitting of the Delegated Legislation and Finance and Budget Committees comes after the National Assembly approved the PFM regulations on October 9.
As of June, the public debt stood at Sh5.81 trillion, equivalent to 61.8 per cent of the gross domestic product (GDP), which is higher than the 50 per cent threshold in the PFM regulations.
According to Kenyan Bulletin sources, West Pokot Senator Samuel Poghisio, who chairs the Delegated Legislation Committee, Irungu Kang’ata (Murang’a), Mohamed Mohamud (Mandera), who chairs the Finance and Budget Committee, and Dr Abdullahi Ibrahim (Wajir), Isaac Mwaura (Kiambu), Rose Nyamunga (Kisumu), Judy Pareno and Farhiya Ali Haji (Wajir) supported the proposal.
The opposers were Moses Wetang’ula (Bungoma), Mutula Kilonzo Jnr (Makueni), Aaron Cheruiyot (Kericho), Okong’o Omogeni (Nyamira), Boniface Kabaka (Machakos), Victor Prengei (nominated) and Millicent Omanga (nominated).
“As Kang’ata pushed for the regulations, he told the committee that the government needs to undertake austerity measures as a sign of goodwill and willingness to cut down on wastages,” the Media source said.
Kenya is a signatory to the EAC Monetary Union Protocol that provides that in the convergence criteria, member countries will endeavour to achieve a public debt ceiling of 50 per cent of the GDP in Net Present Value (NPV) terms by 2021.
The Institute of Certified Public Accountants of Kenya (ICPAK) and civil society groups say that the move will be akin to mortgaging the country due to the high debt burden.