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{
    "id": 1353353,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1353353/?format=api",
    "text_counter": 219,
    "type": "speech",
    "speaker_name": "Emuhaya, ANC",
    "speaker_title": "Hon. Omboko Milemba",
    "speaker": null,
    "content": " Hon. Speaker, you always speak about issues of foreign debt even in meetings held in the constituency. Speaking of increasing foreign debt, since Hon. Mwai Kibaki’s presidency in 2013, our foreign debt has increased from about Ksh1.89 trillion to about Ksh8.588 trillion in the 2022/2023 Financial Year, which we are currently paying. The CFS expenditure accommodates a direct charge on foreign debt payments, pensions and salaries of constitutional offices, which have increased. The payments have increased to Ksh2.08 trillion, which is very high. The Committee discussed how we can reduce this because an increase in payments from CFS expenditure reduces money for development and recurrent expenditure. There are three factors that lead to increased CFS expenditure. We currently have external loans that have imposed commitment fees prior to getting the facility. A recent study shows that the commitment fees on these loans has increased to about Ksh500 million, which is very expensive. Remember we have not yet taken the loans. We have only negotiated through the MDAs. We do not have the money yet we are already paying commitment fees. That is why the Committee has recommended that a report on payment of those loans be provided. The Chairman of the Budget and Appropriations Committee indicated that the Supplementary Budget was based on education and the exchange rate. The exchange rate took a whopping Ksh200 billion, simply because the Kenya Shilling’s value has depreciated against the US Dollar. We are now paying more towards our debts both internally and externally. A majority of foreign debts are paid in either Euros or US Dollars. In fact, the US Dollar forms about 67 per cent while the Euro forms about 19 per cent of all foreign debt. When the Kenya Shilling weakens, we pay more, hence the recommendation to acquire foreign currency. How do we do that? We can enhance the model of the Government to make it a BETA-plus Government. It can only be done through enhancement of our foreign currency reserves through exports. Currently, we only depend on agriculture for foreign currency. The Committee recommended expansion to not only include agriculture, but also affordable housing, the creative economy, the financial sector and export-driven manufacturing. This will enable us to get the foreign currency that is required for stabilisation of the Kenyan shilling. We further indicated that the National Treasury needs to come up with hedging mechanisms, which are allowed in such economic situations. We should borrow in a currency that we can control, like the Kenyan shilling instead of the US dollar, which depreciates leading us to such situations. I also want to flag out the amounts allocated to constitutional offices, like salaries paid to former presidents. Recently, the Auditor-General indicated some form of budgeted corruption, which this Committee is addressing. At one point, money allocated to these constitutional offices was about Ksh4.7 billion, but through the Supplementary Budget, this figure has been reduced to about Ksh3.7 billion, saving a whopping Ksh1.7 billion. Ordinarily, it would be difficult to reduce salaries by such a big margin because of their elastic nature. That means this expenditure item was over-budgeted for. That is why Parliament should be very keen. The Committee recommended that the Auditor-General conducts a special audit to provide details on what warranted this reduction yet salaries are elastic. We have also dealt with issues of pensions, some of which are being paid to pensioners of the colonial crown based in Britain. They signed an agreement in 1973 that Kenya would continue paying their pensions to date. We are not sure whether these pensioners exist or not. The CFS must become an important topic for Kenyans. That is why the Mover has recommended regular reports to citizens. We should also improve citizen participation in CFS expenditure and publish financial reports regularly to enlighten Kenyans on how we are dealing with foreign debt. I thank the Mover for highlighting the measures the Committee has proposed to this House in order for us to manage our foreign debt in a more transparent way than we have been doing before. 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."
}