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{
"id": 1545122,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1545122/?format=api",
"text_counter": 172,
"type": "speech",
"speaker_name": "Sen. Mungatana, MGH",
"speaker_title": "",
"speaker": null,
"content": "Mr. Deputy Speaker, Sir, having said all that, people should not imagine that debt is a bad thing. Debt is a very important tool for economic development, but it has to be sustainable. It has to be managed in a manner that will give results that are intended. Prof. Njuguna Ndung’u, our former Cabinet Secretary in charge of the National Treasury and Economic Planning, has explained this very well, even in his academic writings, that debt in itself is not a bad thing, but are we managing it well? Are we doing well as a country? Like the previous speaker said, our public debt stock has risen so much. As of January, 2025, the total public and publicly guaranteed debt stock in Kenya was standing at Kshs11.02 trillion. This is projected to rise further and we are told from the report that by June, 2027, it is projected that this public debt and the publicly guaranteed debt will go to Kshs13 trillion. Are we doing well in terms of managing our debt? I believe we have a problem and that is why today, I am very proud of the report and the recommendations made by our Senate Committee. Mr. Deputy Speaker, Sir, the debt in itself, the debt stock and the servicing have great costs. In Kenya, these costs continue to rise with the rise in the stock of public debt and the publicly guaranteed debt. I believe the recommendations that have been put need to be implemented at the highest speed possible. Some of these recommendations have to do with transparency. The electronic version of the Senate Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Director, Hansard and AudioServices, Senate."
},
{
"id": 1545123,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1545123/?format=api",
"text_counter": 173,
"type": "speech",
"speaker_name": "Sen. Mungatana, MGH",
"speaker_title": "",
"speaker": null,
"content": "If you look at that report, it says that the National Treasury, the Central Bank and the CoB should fully automate the withdrawal of debt service payments from the Consolidated Fund by 31st May, 2025. Additionally, an inter-agency report on the implementation status of these recommendations should be submitted to Parliament 15 days after 31st May, 2025. This recommendation is saying that the withdrawal of the debt service payments are not automated. Mr. Deputy Speaker, Sir, at least, they are not fully automated. Then what does this mean? It means that some monies can be withdrawn and they are supposed to be servicing debts or servicing the cost of debt and yet we are dealing with paperwork that is physical. This means and we all know that when matters are not automated and when there is human interference, there is a possibility of pilferage. Mr. Speaker, this Senate report is telling us that there is no transparency even in withdrawing the money and making those payments. It is a shame. We have been independent for many decades now and it cannot be that part of the withdrawals for payments on servicing our debt are manual but this is what is suggested here. I pray that by 31st May, 2025, we will receive a report in this Senate that will be telling us that they have automated that. This is because, when you leave it to human interference and human judgments, it will mean that this cost of debt is not what we are paying. Maybe, it is not really what is supposed to be paid. For the ones that are automated, we can always look at them and get a proper report. The one that is not automated, and yet withdrawals are being made from the Consolidated Fund, the National Treasury and from the central bank are manual. Mr. Deputy Speaker, Sir, how can that be? I fully agree with this recommendation that the Central Bank must surely make arrangements to have these withdrawals become automated. There is also a lack of financial controls and the Senate sitting here has recommended that in order to enhance financial control, to improve the accuracy and timeliness of public debt statistics, and strengthen decision-making for greater transparency and accountability, the National Treasury should integrate the public debt management system with IFMIS by 31st May, 2025 and submit a report within 15 days of implementation. Mr. Deputy Speaker, Sir, this suggests that the National Treasury has not integrated the public debt management system with IFMIS. When IFMIS was introduced to this country, it was touted as the system that would solve all the problems. In fact, the Integrated Financial Management System is said to deal with all issues related to government finances. It is strange, when you look at what is happening, that the public debt management system is outside the IFMIS. I have said previously in my statement that the previous recommendation is that it is not fully automated. Some of the payments of the monies in terms of interest or the costs of the loans we have taken are not automated. So here you have non-automation, and then here we have, again, the public debt management system is not in the IFMIS. Is this by design? Or can we say it is human error? No, there is a problem there. Someone must be benefiting, and these are the hideous characters. I have many times said that the National Treasury needs to be drained. How do you explain that? How The electronic version of the Senate Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Director, Hansard and AudioServices, Senate."
},
{
"id": 1545124,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1545124/?format=api",
"text_counter": 174,
"type": "speech",
"speaker_name": "Sen. Mungatana, MGH",
"speaker_title": "",
"speaker": null,
"content": "do we have the IFMIS, the entire Government system, and the debt management system outside that? Through this report, the Senate is telling the Republic of Kenya that there is a problem in the National Treasury. Something is not right. We are saying that this system of public debt management should be integrated by the 31st of May. A report must be brought here so that Kenyans can know what is truly happening. There is also another issue of transparency here. To enhance transparency and accountability in the anticipated increase in domestic borrowing, the National Treasury should, within 60 days, establish a working committee to develop criteria for assessing the effective utilization of borrowed funds by Ministries, departments, and agencies and establish the registrar of Government securities in accordance with Section 55 of the Public Finance Management Act. Many times, even during the campaigns, the question of accountability, clarity and transparency around our debt has been a big political issue. Unfortunately, when we come into the office, it goes quiet. Why? I ask, why? This working committee is supposed to develop the criteria for assessing the effective utilization of borrowed funds. Sen. Faki has said that money is borrowed, and then projects are not carried out because those borrowed funds have come, and then the component, the Government of Kenya, is supposed to pay off Persons Affected by Projects (PAPs), has not paid them. So, the borrowed funds are in the coffers, but the project is not being carried out, and Kenyans do not see the benefit of this money. This Senate is proposing that we establish a working committee to establish criteria for assessing the effective utilization of borrowed funds. This is another issue that has hurt some of our countries. People borrow money and when they bring this money, they do mega projects. Unfortunately, there is no equity in how these borrowed funds are spread across this county. Yesterday, somebody said here on the Senate Floor that he was shocked to learn that money was borrowed. These monies were supposed to benefit one county, which was supposed to build several hospitals and health centres, while his county got zero. For borrowed funds, we need equity. In fact, when this working committee starts working, they should tell us how much money has been borrowed, for example, Tana River County has benefited from these borrowed funds. We do not need to run for President to benefit from borrowed funds, which all of us are paying taxes for. This country needs to get out of this mentality that “it is our time to eat.” We must develop equity for the rest of our country. I have just been looking at how the money is being spread for these roads. A county like Tana River gets almost nothing, while other counties are dominating the entire money. Those monies are borrowed funds. We are asking these working committees to be fair. They should publish the list. We should be honest in this country to heal the wounds that have created marginalized counties like Tana River. We must start being honest. When we use the Government of Kenya to collect money, the benefits of that debt must be spread across the counties so that all of us, even when we are paying it from this generation to the next generation, we should pay to know that the US$7 billion that was borrowed, we also benefited as a county on this percentage. These statistics are not there. The electronic version of the Senate Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Director, Hansard and AudioServices, Senate."
},
{
"id": 1545125,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1545125/?format=api",
"text_counter": 175,
"type": "speech",
"speaker_name": "Sen. Mungatana, MGH",
"speaker_title": "",
"speaker": null,
"content": "We are just told the national debt is Kshs11.02 trillion. Nonetheless, you are not told how much of this Kshs11.03 trillion went to Tana River County. This country needs to start being honest. It must be fair to all of us. Otherwise, this Senate has recommended that a debt register be established that details the use of borrowed funds, including a specific breakdown of project finance through the proceeds of infrastructure bonds. These recommendations are deep. I pray that our colleague Senators will see what I see. Timelines have been given for these recommendations to be activated and actioned. I pray that the National Treasury, the Central Bank and all those agencies that deal with finance will take the recommendation on this 2025 Medium-Term Debt Management Strategy seriously in 2025. For them, it is normal; they do not see it as a serious matter. People sit there and put us in debt, quickly telling us how bad the situation is. For every Kshs100, we have to pay Kshs70 back for debt. Yes, we are paying that Kshs70 shillings, but---"
},
{
"id": 1545126,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1545126/?format=api",
"text_counter": 176,
"type": "speech",
"speaker_name": "Sen. Kathuri",
"speaker_title": "The Deputy Speaker",
"speaker": {
"id": 13590,
"legal_name": "Murungi Kathuri",
"slug": "murungi-kathuri"
},
"content": " Thank you, Sen. Mungatana. Next is Sen. (Dr.) Oburu Oginga."
},
{
"id": 1545127,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1545127/?format=api",
"text_counter": 177,
"type": "speech",
"speaker_name": "Sen. (Dr) Oburu",
"speaker_title": "",
"speaker": {
"id": 194,
"legal_name": "Oburu Ngona Odinga",
"slug": "oburu-odinga"
},
"content": "Thank you, Mr. Speaker, Sir. I rise to contribute to this very important subject of debt management in our country. I must from the outset admit that there is no country which does not have debt. All countries, including the richest ones, borrow money. However, it is not a question of borrowing; it is the question of management; managing the funds that you borrow. Most of the countries in our continent of Africa were classified by the developed world as Highly Indebted Poor Countries (HIPC) of the world. Kenya used to belong to that classification. We were Highly Indebted Poor Country of the world. When you are highly indebted and poor, the risk of investing in you and giving you debt or loans is high. Therefore, the tendency in the financial world is to make borrowed money very expensive. If you make it expensive for poor countries, the result is that they will not pay. Consequently, they will default. This is why the international financial arrangement was made in such a way that if you fall under the HIPC, you would get cheaper loans with long grace periods of repayment. However, you still have to pay. Therefore, when you get access to such loans, you do not access the commercial window in the international markets. Our country moved out of that bracket called HIPC. We were then classified as developing. Now, developing means we have access to the commercial window. That means we can borrow money from the commercial window. This is a very dangerous thing. When you are upgraded to access the commercial window, then it means that you have to be very careful. A lot of countries would like to give you money. They would like to give you money like the Euro bond but that is money which is to be paid in very short periods and these are people who are in a hurry to make money. Therefore, we have to train our people when they do financial negotiations with these people. They are very smart and they have a lot of expertise in negotiating some of these loans. Some of the loans are skewed, even with policies that are there. Some of the policies were there when I was in the Ministry responsible. One of those policies stated, The electronic version of the Senate Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Director, Hansard and AudioServices, Senate."
},
{
"id": 1545128,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1545128/?format=api",
"text_counter": 178,
"type": "speech",
"speaker_name": "Sen. (Dr) Oburu",
"speaker_title": "",
"speaker": {
"id": 194,
"legal_name": "Oburu Ngona Odinga",
"slug": "oburu-odinga"
},
"content": "any loan which does not contain a 35 per cent grant within it, was not touched by our Government. I do not know whether this policy is still there or not. However, it was one of the things which was making it difficult for many people who just wanted to make quick money to be running for the government. The other reason is that it makes it more difficult to negotiate cheaper loans in the long term with a longer grace period of negotiations. However, some of these people, the multilateral institutions that give cheap loans, are very sensitive. There are a lot of projects in our country which have stalled, not for any other reason, but because of activism. Sometimes, there is a lot of activism. If there is an issue coming out that the people have not been properly consulted on some issues or even the issues of what you call aesthetics--- For instance somebody can claim that the project being implemented is on his land where he buried his grandfather and has such a great attachment to his grandfather. Therefore, the project is interfering with the enjoyment of that right to have his grandfather's grave. That alone is enough to stop a project. It takes more than a year to renegotiate and get that project back. I can give you an example. In the Sondu Miriu project, there was some activism. Some people wanted their voices to be heard. They raised it when the project was already on. The Japan International Cooperation Agency (JICA) funders who were funding that project in Japan took that matter to the Japanese Parliament and said that the locals are complaining about the land. They have some attachment to this and they were not properly consulted. It took more than a year to renegotiate for them to come back. That happens with World Bank projects. I hope that some of these issues which sometimes occur are well taken care of by the implementers of these projects in our country, so that we do not get such delays in implementation. When you get delays in implementation, interest keeps on accumulating. Even for that period when the project is stopped, the interest will continue to accumulate and the Kenyan taxpayers will pay heavily for such incompetence. We must look for alternative ways of development. We cannot concentrate on one way, which is just loans and raising taxes. We can raise taxes, we can get loans, but it might not be enough. There is a lot of money in private hands. We need to tap that money in private hands and use it for the development of our country. It is being done in America. If you go there, you find big highways. They are built by the private sector. They developed systems of Public-Private Partnerships (PPPs) for a long time. It took Kenya a very long time to develop policies which were acceptable to the private sector to start utilizing the PPP principle. It started here just about 10 or so years ago. This is an area which I would advise our people to use effectively as opposed to negotiating to raise our debt levels too high. Mr. Deputy Speaker, Sir, the Public-Private Partnerships (PPPs) in infrastructure of roads, water, electricity and energy, generally, is something which is very handy, particularly in developing countries such as India. India has effectively used the PPPs and we should take that example. In Kenya, there was one which was not very transparent. Sen. Onyonka took the lead here in fighting for the rights of Kenyans to know what was happening because it was not all that transparent. Nevertheless, that is a lesson to us. The electronic version of the Senate Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Director, Hansard and AudioServices, Senate."
},
{
"id": 1545129,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1545129/?format=api",
"text_counter": 179,
"type": "speech",
"speaker_name": "Sen. (Dr) Oburu",
"speaker_title": "",
"speaker": {
"id": 194,
"legal_name": "Oburu Ngona Odinga",
"slug": "oburu-odinga"
},
"content": "The PPP is not wrong. I do not think Sen. Onyonka was fighting against the PPP principle. He was fighting against the lack of transparency in the implementation of the project, so that people know they are getting value for their money. Those who can do the same thing are allowed to compete and participate in those projects. I sincerely believe that if we develop this system, it will help us reduce our debt level. I also want to just commend Sen. Mungatana. He has stressed very much on keeping records and digitalising the management of debt. This is long overdue. This is something which started long ago when I was still there. I am quite surprised. There must be something somewhere on why this has not been done fully up to today. That is the way to go."
},
{
"id": 1545130,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1545130/?format=api",
"text_counter": 180,
"type": "scene",
"speaker_name": "",
"speaker_title": "",
"speaker": null,
"content": "(Applause)"
},
{
"id": 1545131,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1545131/?format=api",
"text_counter": 181,
"type": "speech",
"speaker_name": "Sen. (Dr) Oburu",
"speaker_title": "",
"speaker": {
"id": 194,
"legal_name": "Oburu Ngona Odinga",
"slug": "oburu-odinga"
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"content": "There must be people there who are either benefiting. I do not know why it has not been digitalised fully up to now yet it is recommended in the Report. That should be done by yesterday. It is something which should be completed. It is not something we should continue arguing about. All the offices which have been mentioned are there and it is their responsibility. Otherwise, the Senate is going to make its recommendations which we hope will be implemented and not kept in the shelves. In Kenya, we are used to having very good ideas, but they are never implemented. We have better ideas than many countries around us. However, many countries even steal our ideas and implement them. Mr. Deputy Speaker, Sir, there is a country here called Botswana, which is not rich. It only has some minerals such as diamond, but most of the land is just arid and semi-arid. It is mostly arid like our country with three-quarters aridity. They have cattle just as we do, but they have managed to develop their meat industry by protecting their livestock and exporting meat to countries which are near us. Botswana has become so rich that they are funding the World Bank which gives us money. They have money which is kept and called money for the future. It is not touched for recurrent expenditure. It is kept in an account where it is reinvested in other institutions including the World Bank. Therefore, with that kind of example, it means that there is something we need to do. We need to do more in our country to reduce our debt levels and make sure that our people do not bear big burdens when there are opportunities open to them. All that we need to do is to enable them so that they can earn money and do their things. Mr. Deputy Speaker, Sir I do not want to contribute more to this. I thank you for the opportunity. I hope that our Report will be implemented and we shall be heard. Lastly, there was a report here in Bunge some time ago by Hon. Elijah Mwangale, on the JM Kariuki report and he said there is a saying in Luhya that “the hyena was moving in the forest, he found a stone and he told the stone, please, hear me. I am talking to you and I am telling you to do the right thing. Stone, even though you are quiet, but I am sure you have heard.”"
}
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}