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"speaker_name": "Mr. Kimunya",
"speaker_title": "The Minister for Finance",
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"legal_name": "Amos Muhinga Kimunya",
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"content": " Mr. Speaker, Sir, I beg to add to our apologies 3870 PARLIAMENTARY DEBATES November 22, 2006 for not having been here when required. Mr. Speaker, Sir, I beg to move that the Appropriation Bill, 2006, be read a Second Time. I wish to notify that His Excellency the President has signified his consent to this Bill. The Appropriation Bill, 2006, seeks the statutory approval of Parliament to the Government expenditure contained in the Estimates of the Financial Year 2006/2007. Subsequent to the laying in the House of the Estimates for Recurrent and Development Expenditure, this House approved the Vote-on-Account on 22nd, June, 2006. The Treasury has, therefore, been implementing the national Budget for 2006/2007 on the basis of this authority. I wish to thank this House for making sure that Government programmes and services to this nation did not stall or become deficient. I have on various occasions affirmed the Government's commitment to pursue the best practices in financial management. In this regard, the Treasury will continue to institutionalise the reforms that are required. It will further improve the budgeting process and financial management for enhanced development results for Kenyans. We are paying particular attention to reviewing the process and procedures, including Budget formulation methods, in order to identify areas that require strengthening and enhancement. These moves will result in sound Budget formulation, implementation guidelines and expenditure controls, which are key to the prudent management of our resources. For the record, let me highlight some of the reforms and other measures we are implementing in the area of public finance. These are mainly the strengthening of financial reporting, and generation of accurate national data to facilitate sound planning and management of our resources. Accurate and clear financial reports will enhance our transparency and accountability. This will entail the reporting format for accuracy and comprehensiveness. The second measure I wish to highlight is the re-orientation of expenditures to the priority sectors of our economy. In order to raise the competitive capacity of our enterprises, we will continue with the development of infrastructure and upgrading of existing facilities. In this regard, the focus will be mainly on the development of roads, making the railways efficient and enhancing electrification programmes. The Government is committed to uplifting the standard of living of all Kenyans. In order to achieve this, we will earmark funds for programmes that will have a positive impact on economic growth in rural areas, such as the construction of roads, provision of water and electricity. The Government has also increased allocation for core anti-poverty programmes as part of the strategy for sustainable development, to reduce vulnerability of people living in the poverty-prone and semi-arid lands. On account of the prudent management of our economy, implementation of structural reforms to date, including in the areas of governance, the economy has registered steady and broad- based growth since 2003. Indeed, as we all know, last year our economy grew by 5.8 per cent. We expect this growth to edge at slightly over 6 per cent in 2006. We have also managed to contain inflation and, more importantly, interest rates to affordable levels. Now, a large number of Kenyans can afford to borrow from the banking sector to finance their programmes. The Government is committed to meaningfully uplifting the living standards of our people in line with the economic recovery strategy, as well as the Vision 2030 that is currently being developed. We will continue until the year 2030 when we will have improved the quality of the lives of Kenyans and made this country a prosperous middle-income country. Mr. Speaker, Sir, the vision that we are envisaging aims at scaling up development and the rate of economic growth to rate of, on average, 10 per cent. We hope to sustain this rate to the year 2030 to achieve the growth that we desire. To achieve this vision, we will require substantial investment by both the private and public sectors. We will also need to undertake some further structural reforms to tackle those factors that continue to hinder November 22, 2006 PARLIAMENTARY DEBATES 3871 our development. As part of the broad reform programme, we intend to further strengthen the public financial management by taking reform measures in this area. The reforms we intend to implement, especially in financial management, are as follows. Mr. Speaker, Sir, the first one is developing a comprehensive budget law that will encourage and demand better financial management practices. The Treasury is currently in the process of developing this comprehensive budget law that will, among other provisions, address the concerns of this House. The proposed budget law will also endevour to enhance consultations with this House in the formulation and implementation of the Budget. Some of the salient provisions that relate to the oversight role of this House, as envisaged in this new comprehensive budget law, are: (a) the Minister for Finance will provide the National Assembly with reports and information as may be necessary to enable the National Assembly to be kept informed of the state of the economy of this country on a periodic basis; (b) the Minister for Finance will inform the National Assembly on the policy basis for the annual Estimates; (c) the submission of a Budget strategy paper to the National Assembly before the finalisation of the Estimates; this strategy paper shall include an assessment of both the current and projected finances of the country; (d) a submission to the National Assembly in terms of the mid-term review of the implementation of the Budget. These are key reforms that we hope to finalise in the next one or two months. I hope we will have the consultations that are required to get it going. I hope we will pass it in the early part of the year for it to be in place before the next budgeting cycle. Mr. Speaker, Sir, the second reform measure is the re-orientation of the budgeting methodology and presentation. This will mainly involve the linking of the Budget to outputs, and shifting from the standard line item to programmes in which performance targets will be indicated. So that in terms of us not focusing any more on line items, we want to start telling Kenyans through this House that we are going to spend so much money on this programme to achieve this output rather than just talking about the expenditure item. We also believe that this will facilitate the performance management and enable the administration of performance contracts, and subsequently the assessment and evaluation of the performance of our public officers. Mr. Speaker, Sir, the third and final item I want to touch on in terms of these reforms is the Budget scheduling. Due to time constraints, as we are aware, this House was only able to debate seven Votes. The rest were approved through the guillotine procedure. We have over the years taken cognisance of this fact. I have instructed my officers to develop a Budget preparation process that will enable me to discuss the Budget Strategy Paper with this House before the finalisation of the Printed Estimates to facilitate the effective consultation way before the Budget is presented. Even if caught by time, we will have covered most of the items long before the Vote-on-Account. The Estimates will be presented in form of programmes that will serve as a broad indication of the intent of the Government. This reform is intended to create time for analysis of the Budget, and facilitate consultation on the same with the relevant Committee of this House. Mr. Speaker, Sir, as indicated, due to this heavy schedule the House managed to discuss only the following Votes. (i) Vote 01 - the Office of the President (ii) Vote 11 - the Ministry of Health (iii) Vote 12 - the Ministry of Local Government (iv) Vote 13 - the Ministry of Roads and Public Works (v) Vote 16 - the Ministry of Trade and Industry (vi) Vote 30 - the Ministry of Energy (vii) Vote 31 - the Ministry of Education. The rest of the Votes were approved, as you all are aware, through the guillotine procedure in 3872 PARLIAMENTARY DEBATES November 22, 2006 accordance with Standing Order No.142, paragraph (7). Mr. Speaker, Sir, I intend to contain the expenditures within the planned financing framework despite the shortfalls in revenue that may have been occasioned by circumstances beyond our control. However, as we move forward and circumstances warrant, the Government may consider some adjustments in the Government expenditure programme to align it with expected revenue outcome. Hon. Members are aware of the measures that may have led to some of the shortfalls in income, and I hope we shall take appropriate action at the right time to avoid further leakage of revenue. I will come to that on a different day. Mr. Speaker, Sir, turning to the Appropriation Bill (2006), it contains the details of supply for each Vote, including the amount that shall be applied as Appropriations-in-Aid (AIA). Again, discussing the Bill further, Clause 2 provides for the issue out of the Consolidated Fund for sum of Kshs342,863,389,131 and to appropriate the funds for various services and purposes during the financial year ending 30th, June, 2007. This sum includes the amounts that were authorised by Parliament on the 22nd, June, 2006 through a Vote-on-Account in accordance with Section 101 of the Constitution of Kenya. Clause 3 of the Bill makes provision for the amounts to be applied as AIA for the various services and purposes. Mr. Speaker, Sir, having briefly appraised hon. Members of the objects and reasons for the Bill, may I now request them to pass it in order to authorise the issue of the funds from the Consolidated Fund to meet the expenditures as contained in the Recurrent and Development Estimates of 2006/2007 Financial Year. Mr. Speaker, Sir, as I conclude, I wish to thank hon. Members for the constructive contributions made during the Committee of Supply on the various Votes. These contributions will always be recognised and taken seriously. Where necessary, appropriate action has been, and will continue to be taken. I look forward to working harmoniously with hon. Members as we continue to endeavour to develop this great nation. With those few remarks, I beg to move and ask Mr. Katuku to second the Bill."
}