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{
    "id": 1213879,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1213879/?format=api",
    "text_counter": 250,
    "type": "speech",
    "speaker_name": "Kitui Rural, WDP",
    "speaker_title": "Hon. David Mwalika",
    "speaker": null,
    "content": " Thank you, Hon. Temporary Speaker. At the outset, I want to support this Report and thank the last Parliament for coming up with this Committee on Public Debt and Privatisation. This is the first report where Parliament is looking at public debt. As the earlier speaker said, debt is not a bad thing. It becomes bad if it is not utilised for its intended purpose. With the debt which we have taken for the last 10 years amounting to around Ksh8 trillion, we should be seeing a lot of development in this country. Unfortunately, we do not see it. I start wondering where that money goes to. Is it being used in particular areas other than those that the debt should be used for? In economics, there is the law of diminishing returns. If you used debts in one area and you realised that there is no development… For example, I was a consultant on the Lamu Port- South Sudan-Ethiopia Transport (LAPSSET) Project. The expected outcome was that if we developed LAPSSET, we would increase the country’s Gross Domestic Product (GDP) by 2 per cent, which amounts to around Ksh250 billion every year from that investment. There is no country which can develop without debts. In fact, most developed countries have high levels of debt. Japan’s debt is 256 per cent of its GDP. For the United States of America (USA), it is 133 per cent, while Sudan is at 210 per cent. Those figures are as per a Report done by the World Bank in 2021. At that time, Kenya’s debt was 7 per cent of its GDP. Kenya’s debt has increased to Ksh9.15 trillion. That is an alarming situation when you think about the Ksh1.36 trillion that is needed to service the debt. We only collect around Ksh1.8 trillion or Ksh2 trillion in taxes. If we remove Ksh1.3 trillion, we remain with around Ksh600 billion to run the country. Recurrent expenditure alone in this country is around Ksh600 billion. We barely have anything left for development. In that kind of a situation, I do not think this country can develop. Apart from the recommendations that are proposed in the Report, I would like to propose the following: First, we need to reform our tax system so that we raise more revenue. We have been over-taxing three sectors of the economy – manufacturing, information, communication and technology (ICT); finance and insurance. We have realised that taxes from those sectors are actually going down because they comprise 17 per cent of GDP, but contribute 52 per cent of tax revenue. So, we need to expand the tax base so that we can get more revenue and go for more concessional loans, which are cheaper and have a longer repayment period. We also need to enhance local savings, such as the National Social Security Fund (NSSF) and the National Health Insurance Fund (NHIF). Let us also live within our means. I was looking at the Supplementary Budget and I thought that it was supposed to go down by Ksh300 billion. Unfortunately, the overall budget went up by Ksh14 billion. Where are we moving to as a country? We need to live within our means, borrow less, spend what we are raising and move this country forward. With those few remarks, I support the Report."
}