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{
"id": 193502,
"url": "https://info.mzalendo.com/api/v0.1/hansard/entries/193502/?format=api",
"text_counter": 84,
"type": "speech",
"speaker_name": "Mr. Kimunya",
"speaker_title": "The Minister for Finance",
"speaker": {
"id": 174,
"legal_name": "Amos Muhinga Kimunya",
"slug": "amos-kimunya"
},
"content": "Arising from the strong performance under the income taxes, we have revised the likely revenue out-turn to Kshs448.8 billion, of which Kshs402.7 billion is ordinary revenue and 1152 PARLIAMENTARY DEBATES June 12, 2008 Kshs46.1 billion is A-in-A. I wish to thank the Kenyan taxpayers for their hard work in generating the revenue and, more importantly, their patriotism in paying their taxes. On expenditure, the 2007/2008 Printed Estimates indicated total expenditure of Kshs693.6 billion including those financed through A-in-A. That consisted of Kshs154.2 billion for Consolidated Fund services, Kshs337.8 billion for Ministerial Recurrent and Kshs201.7 billion for Development Expenditures. Owing to the unforeseen commitments and huge expenditure requirements on relief supplies, security, free secondary education, the post-election related expenditures among others, I recently requested Parliament to authorise additional expenditures under the 2007/2008 Supplementary Estimates. Hon. Members will recall that the Supplementary Estimates for the Financial Year 2007/2008, which they recently approved, indicated a net increase of Kshs14.1 billion and Kshs7.1 billion for Recurrent and Development Expenditure in that order. On the Recurrent Expenditure, the gross Recurrent Expenditures amounted to Kshs512 billion, of which Kshs43 billion was financed through user fees and duties collected and applied at source - in other words, A-in-A. The non-discretionary expenditures which are financed directly from the Consolidated Fund Services took a total of Kshs154.6 billion, while the discretionary Recurrent Expenditures took the remaining Kshs357.4 billion. The revised allocation for Consolidated Fund Services for the fiscal year 2007/2008, therefore, consisted of Kshs41.6 billion for domestic interest, Kshs6.1 billion for foreign interest payments, Kshs25.6 billion for pension, gratuities and other CFS payments. In addition, the revised Consolidated Fund Services also included Kshs64.6 billion and Kshs16.8 billion for financing our external and domestic debts redemptions, respectively. On development, the Supplementary Estimates for the Fiscal Year 2007/2008 indicated gross Development Expenditures amounting to Kshs209.2 billion, with Kshs39.7 billion being financed through loans, Kshs32.5 billion through grants and Kshs4 billion through local A-in-A. That left Kshs133 billion which was to be financed directly through the Exchequer. Turning now to the projections for the 2008/2009 Financial Year, this Budget that I am presenting today is a product of a lengthy, participatory and consultative process that has involved the Government, the public and other stakeholders. The process included the sector working groups, which included the private sector, our development partners and budget submissions by Kenyans of all walks of life. I wish at this point to thank all those who really contributed to this process. On revenue, the total revenue target for the Fiscal Year 2008/2009 is Kshs512.8 billion, which is the equivalent of 21.4 per cent of our projected Gross Domestic Product (GDP). That comprises Kshs467.9 billion of ordinary revenue and Kshs44.8 billion of A-in-A. Revenues are, thus, projected to grow by Kshs63.9 billion, including growth in ordinary revenues of Kshs65.2 billion. The growth that is projected on the revenue of 16.2 per cent is based, again, on the continuing successful implementation of reforms by the Kenya Revenue Authority (KRA) and additional tax measures that I will be proposing today. At this point, I wish to pay tribute to the efforts of our KRA for expanding the tax base and collecting all this money which has helped us to reduce our dependence on aid. On Recurrent Expenditure, hon. Members will note from the copies of the Printed Estimates that were tabled yesterday, that the gross Recurrent Expenditure for 2008/2009 is estimated at Kshs563.6 billion. That includes Kshs39.7 billion to be financed through A-in-A and Kshs174.6 billion to be financed directly from the Consolidated Fund Services, thereby, leaving a net of Kshs388.9 billion for discretionary expenditure. The Consolidated Fund Services comprise Kshs48.7 billion for domestic interest, Kshs7.2 billion for foreign interest, Kshs28.2 billion for pension, gratuities and other CFS appropriations. In addition, I expect to finance internal and external redemptions amounting to Kshs67.9 billion and Kshs22.7 billion, respectively. June 12, 2008 PARLIAMENTARY DEBATES 1153 On development, the gross Development Expenditure for 2008/2009 is estimated at Kshs196.2 billion. Out of that amount, Kshs52.6 billion will be financed through A-in-A, comprising of direct project financing of Kshs30.9 billion in loans and Kshs4.7 billion in total A- in-A. Consequently, I expect to finance net Development Expenditures amounting to Kshs143.6 billion from the Exchequer. That comprises of Kshs16.7 billion in grants, Kshs16.5 billion in loans and Kshs110.3 billion from the Government of Kenya. Mr. Speaker, Sir, on external financing, the external grants and loans have received confirmed commitments amounting to Kshs33.8 billion in grants and Kshs47.4 billion in loans that we have contracted to finance development projects. Details of the donors and the projects that are being financed are included in your copy of Development Estimates. I wish to sincerely thank those development partners who have pledged their support for our development efforts. Mr. Speaker, Sir, looking at the revenue and expenditure, the overall fiscal deficit, including grants, in the year 2008/2009, is projected to be Kshs127 billion, which is the equivalent of 5.3 per cent of GDP. The net external financing amounting to Kshs25.2 billion or 1.1 per cent of GDP is expected to cover part of that Budget deficit, leaving Kshs101.8 billion or 4.3 per cent of GDP to be financed through several initiatives which include privatisation proceeds that are estimated at Kshs8 billion. I believe we will be working with the Privatisation Commission to identify more shares to bring to Kenyans. We will also, like I said, issue infrastructure bonds amounting to Kshs52.1 billion out of which Kshs33.6 billion will be issued through a sovereign bond externally and Kshs18.5 billion will be raised through domestic long-term bonds, leaving us with a gap that we will meet from net domestic borrowing of Kshs36 billion. This means that our fiscal framework for 2008/2009 is fully financed with no financing gap."
}