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{
"id": 1525022,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1525022/?format=api",
"text_counter": 959,
"type": "speech",
"speaker_name": "Endebess, UDA",
"speaker_title": "Hon. (Dr) Robert Pukose",
"speaker": null,
"content": " Thank you, Hon. Temporary Speaker. I stand to support the Liaison Committee’s consideration of the 2025 MTDS Paper as laid in the House. The Report talks about external borrowing being relatively cheaper than domestic borrowing. This is due to the share of concessional loans from multilateral lenders such as the World Bank and our development partners. Indeed, 54 per cent of the total external debt portfolio is concessional, and it significantly contributes to the sustainability of Kenya's debt. My colleague, Hon. Oundo, has misled the public by saying that you can conduct Harambee to pay external debts. I do not think there is a country that has ever conducted Harambee to pay an external debt. I presume that he was just joking. He must have said it on a light touch. There is no country in the world that does not borrow. Japan, USA and any of the developed countries borrow. All countries borrow and have debts. We noted that external commercial borrowing is relatively expensive compared to concessional loans, as I have already mentioned. Therefore, various measures, including paying off some of the most expensive loans and exploring cheaper debt instruments such as green bonds, are being considered in this Report. Following the review of the 2025 MTDS, the Committee observed that the Government will borrow Ksh831.1 billion, which is equivalent to the fiscal deficit in the 2025 BPS. This amount will be sourced from both domestic and external sources at a ratio of 65:35 respectively. The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
},
{
"id": 1525023,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1525023/?format=api",
"text_counter": 960,
"type": "speech",
"speaker_name": "Endebess, UDA",
"speaker_title": "Hon. (Dr) Robert Pukose",
"speaker": null,
"content": "To mitigate the growing risk of domestic debt interest payments and reduce the tendency of the Government borrowing funds held by public entities, the Ministry of National Treasury and Planning should deploy the TSA for all MDS"
},
{
"id": 1525024,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1525024/?format=api",
"text_counter": 961,
"type": "heading",
"speaker_name": "",
"speaker_title": "",
"speaker": null,
"content": ","
},
{
"id": 1525025,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1525025/?format=api",
"text_counter": 962,
"type": "other",
"speaker_name": "",
"speaker_title": "",
"speaker": null,
"content": "parastatals and public funds as mentioned by various Members who have spoken, among them the Deputy Speaker, who moved this Motion. The Leader of the Majority Party, along with Members of the Budget and Appropriations Committee, including Hon. Makali Mulu, stressed on the issue of TSA. I think this is the direction to go. As we speak, the Republic of Tanzania is already using the TSA. Yesterday, the Controller of Budget said that she has been to Tanzania over the same issue. So, it is high time that, as a country, we also deployed the same mechanism. Members have raised concerns about transparency and accountability when it comes to domestic borrowing. The Committee has already made some recommendations requiring the Cabinet Secretary for National Treasury and Economic Planning to, within 60 days: 1. Form a working committee to establish criteria for assessing the effective utilisation of borrowed funds by MDAs, and establish the registrar of Government securities pursuant to Section 55 of the Public Finance Management Act (Cap. 412A). 2. Record the debt in the register with the details on the utilisation of the borrowed funds, including the set of projects funded from the proceeds of infrastructure bonds. This will make it much easier for people to look at the register and access that information. With those few remarks, I support."
},
{
"id": 1525026,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1525026/?format=api",
"text_counter": 963,
"type": "speech",
"speaker_name": "Hon. David Ochieng’",
"speaker_title": "The Temporary Speaker",
"speaker": null,
"content": " Next is the Member for Kitui Rural, Hon. Mboni."
},
{
"id": 1525027,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1525027/?format=api",
"text_counter": 964,
"type": "speech",
"speaker_name": "Kitui Rural, WDM",
"speaker_title": "Hon. David Mwalika",
"speaker": null,
"content": " Thank you, Hon. Temporary Speaker. At the onset, I support the Report. This is the second of such Report since the start of the 13th Parliament. It is very good that we know our debt stock. Debt is not a bad thing. There is no country that has ever developed without borrowing. Developed countries are more indebted than developing ones. For example, Japan has the highest debt to GDP ratio at present value estimated at 256 per cent while the United States of America is at around 123 per cent. Most of the developing countries are below 100 per cent but they ‘cry’ more because they either take expensive loans or they do not utilise the loans effectively. Most of the loans are wasted and, therefore, repaying becomes a problem. Going forward, our loans should go into programmes with high economic and social returns so that it is easier for us to pay as a result of the impact they bring to this country. One thing that is worrying in this Report is the Kenya loans mix. The domestic loan portfolio is 65 per cent while the external loan portfolio is 35 per cent. Domestic loans have their own effects. Firstly, the interest rates are very high. Secondly, their repayment period is very short. It is about five years. More critical is the fact that the Government has cropped out private sector borrowing. Last year, the Treasury Bond rates were around 20 per cent. As a result, the banks increased their interest rates because it was less risky for banks to loan the Government than the private sector. Government borrowing increases the commercial bank interest rates thus making it difficult for actors in the private sector to borrow and invest or expand or establish start-up businesses. This has a serious effect on economic growth. We need to move to more concessional loans, which have low interest rates and longer repayment periods. This is to ensure that we benefit from the loan and desist from borrowing. How did we find ourselves in this situation? The first problem is the way we prepare our budgets. We always have a budget with high deficits. The moment this House approves a budget with deficits, it is already approving borrowing because the deficit has to be financed. The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
},
{
"id": 1525028,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1525028/?format=api",
"text_counter": 965,
"type": "speech",
"speaker_name": "Kitui Rural, WDM",
"speaker_title": "Hon. David Mwalika",
"speaker": null,
"content": "Currently, the deficit in our national budget stands at around 17 per cent. We need to strive to balance our budgets so that we reduce borrowing. We also need to reduce the use of Article 223 of the Constitution, a provision in financial management that is being misused by mandarins at the National Treasury. We spend between Ksh100 billion and 200 billion annually using this Article. That is money which is not budgeted for, and when spent, it immediately affects the projects that are budgeted for. It is a pity that some withdrawals for debt payments are made manually. Last week, we met with the Controller of Budget, who said that she approves 115 debt payments every week. Some of them are done manually, and she has no time to go through all those payments. Therefore, the recommendation that the National Treasury automates the withdrawal of debts money is important to increase accountability in debt repayment. Hon. Temporary Speaker, the other thing is fiscal consolidation. This is a song that we have sung for too many years, and it is high time that we strictly followed fiscal…"
},
{
"id": 1525029,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1525029/?format=api",
"text_counter": 966,
"type": "scene",
"speaker_name": "",
"speaker_title": "",
"speaker": null,
"content": "(Technical hitch)"
},
{
"id": 1525030,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1525030/?format=api",
"text_counter": 967,
"type": "speech",
"speaker_name": "Hon. David Ochieng’",
"speaker_title": "The Temporary Speaker",
"speaker": null,
"content": " Please add him 30 seconds."
},
{
"id": 1525031,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1525031/?format=api",
"text_counter": 968,
"type": "speech",
"speaker_name": "Kitui Rural, WDM",
"speaker_title": "Hon. David Mwalika",
"speaker": null,
"content": " It is high time we strictly implemented fiscal consolidation, and reduce unnecessary expenditures relating to foreign travel and hospitality expenses. We should reign in on the general wastage that we have been financing through the budget. Concerning the proposal on introducing TSAs for Ministries, Departments and Agencies (MDAs), I was reading somewhere last week that the money we collect for Affordable Housing has earned Ksh2 billion from Government securities. If we had employed the use of TSA, the Government would have money to spend without having to borrow and pay interest. We need to implement this strategy. The National Treasury should not be telling us when they are going to implement it. The implementation should have been done like yesterday rather than today."
}
]
}