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The Budget and Appropriations Committee of the National Assembly wants funds set up to clear all verified pending bills.
Committee Chair Kanini Kega is proposing an upward review of the debt ceiling to enable implementation of this year’s budget.
“By end of March this year the stock of public debt was Ksh.7.34 trillion which is 82 per cent of the current Ksh.9 trillion national debt ceiling,” she said.
In the new financial year, Consolidated Fund Services(CFS) expenditure will increase by 24 per cent to Ksh.1.33 trillion which is a rise of Ksh.253.5 billion.
Kega has warned that implementation of the budget hangs in a balance owing to an increase in expenditure against diminished revenue returns.
Owing to this the budget committee is recommending that parliament increases the debt ceiling to give the government wiggle room against current shrinking budget flexibility.
In a report tabled in parliament this week, BAC says that a five-year review indicates that by 2021/2022, the CFS will have increased by over 150 per cent since 2016/2017.
Additionally, the report states the annualised growth rate is 20 per cent which is much higher than the normal GDP growth rate of the same period.
“The committee is concerned that FY 2021/2022 budget may not be implementable if the debt ceiling is not adjustable.
However, the budget committee warns that the expected revenue performance was subject to economic recovery against risks such as Covid-19 disruptions, high cost of fuel and political uncertainty.
The committee recommends that the National Treasury set up a fund by October 2021 that may be financed through a long term bond for the payment of existing verified pending bills and court awards.
National Treasury Secretary Ukur Yatani will this afternoon present the Ksh.3.66 trillion budget.
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