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{
    "id": 1382303,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1382303/?format=api",
    "text_counter": 189,
    "type": "speech",
    "speaker_name": "Kathiani, WDM",
    "speaker_title": "Hon. Robert Mbui",
    "speaker": null,
    "content": "borrow. We are planning to borrow more money. This regime can teach the previous one a lot of things on borrowing. This is because they are now going further into using other marketing instruments like Green, Blue, Samurai, Panda and Sukuk Bonds, among others. There is a better and more intention of borrowing from that strategy. Borrowing is not necessarily a bad thing. Even in our investments, we borrow money so that we can do good things with it. What matters is not what one uses the money for, but how he spends it. If you borrow and put up an investment that gives you good returns, then it is a good one. However, if you borrow money and then you consume it or use it for normal day-to-day operations, then that is a problem. There is also a problem when one borrows to pay bad loans. This is not a good strategy. Unfortunately, I have seen a tendency where the current borrowing is at a much higher cost than the previous one. The Government borrows so that it can settle loans that were borrowed at lower interest rates and thus, they pay higher interest rates based on the current plan. We have to be careful about those things. It is also unfortunate that there is a lot of borrowing from the local market. The late President, His Excellency Mwai Kibaki, stopped borrowing from the local market. That immediately opened up and stopped crowding out the private sector. Business people took loans from banks. Before the late President Kibaki’s tenure, even opening accounts with some of those major banks was almost impossible. That is because the minimum deposits were so high as they were dealing directly with the Government. It is something that we need to look into. Why should we allow our Government to borrow from the local market and crowd out the private sector? I also want to point out that the National Treasury does not take this House seriously. We are aware that they have told this House several times that they would release funds meant for the National Government Affirmative Action Fund (NGAAF) and National Government Constituencies Development Fund (NG-CDF), but they have not honoured it. This has happened four times. I have said this because the Committee’s recommendations confirm the same. Recommendation five says that within 30 days of the adoption of this Report and subject to Section 50 of the Public Finance Management (PFM) Act, the National Treasury will submit a comprehensive report to the National Assembly on the breach of the debt anchor of 55 per cent of GDP. We are at about 70.8 per cent of the GDP. That means that when the National Treasury gave an undertaking, they did not fulfil it. We are now giving them time to go and fulfil something that they did not fulfil, when they had the opportunity. In the last discussions on the Medium-Term Debt Management Strategy, we talked about the National Treasury opening a single account. We are repeating ourselves."
}