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{
    "id": 556211,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/556211/?format=api",
    "text_counter": 259,
    "type": "other",
    "speaker_name": "",
    "speaker_title": "",
    "speaker": null,
    "content": "Hon. Speaker, in the Financial Year 2015/2016, the Government has made it a priority to shift more resources from Recurrent Expenditure to Development Expenditure as required by the Public Finance Management Act, 2012. As a result, Recurrent Expenditures are projected to decline from the estimated figure of 16.4 per cent of GDP in Financial Year 2014/15 to 15.5 per cent of GDP in Financial Year 2015/2016. The ceiling for Development Expenditure, including foreign aid financed projects and excluding net lending, amount to Kshs716.3 billion in Financial Year 2015/16, including Parliament and the Judiciary. Most of the outlays are expected to support critical on- going infrastructure programmes in roads, the Standard Gauge Railway (SGR), ports, energy and security, among others. Part of the Development Budget will be funded by project loans and grants from development partners, while the balance will be financed from domestic resources. Hon. Speaker, reflecting the projected expenditures and revenues, the overall fiscal balance, including grants (amounting to Kshs73.4 billion) is projected at Kshs570 billion, which is equivalent to 8.7 per cent of the Gross Domestic Product in Financial Year 2015/2016. Excluding expenditures related to the SGR, the overall deficit would decline to Kshs426 billion, which is equivalents to 6.5 per cent of the GDP. The fiscal deficit in Financial Year 2015/2016 will be financed by net external financing of Kshs340 billion or about 5.2 per cent of the GDP and Kshs229.7 billion or 3.5 per cent of the GDP of domestic financing. Thus, the overall fiscal deficit is fully financed. Hon. Speaker, the Government’s borrowing plan remains anchored in the Medium-Term Debt Strategy Paper, which aims at ensuring public debt sustainability. The strategy envisages continued borrowing from domestic and external sources with the latter being largely on concessional terms. While external financing will be largely on concessional terms, the Government will continue to diversify financing sources by continuing to access commercial sources of financing in the international financial market. Hon. Speaker, as hon. Members will recall, last year, our debut Sovereign Euro Bond was received with a lot of enthusiasm by foreign investors, once again underscoring the confidence that foreign investors have in our economy. Going forward, we intend to continue sourcing those types of funds, including from export credit agencies and syndicated loans. I would like to assure hon. Members that non-concessional external borrowing will be undertaken in a cautious manner and limited to bankable projects, and will broadly be within the ceiling in the Medium-Term Public Debt Strategy Paper. This will ensure that our total public debt will remain sustainable over the medium term. In addition, the Government will ensure that the level of domestic borrowing does not crowd out the private sector given the need to increase private investment and accelerate economic expansion. A cautious approach will also be adopted in the issuance of external Government loan guarantees and the use of the Public Private Partnership framework for funding infrastructure in order to minimise the level of contingent liabilities. Hon. Speaker, the rest of my Statement highlights the various tax measures I intend to introduce through the Finance Bill, 2015, and other miscellaneous amendments I have tabled in this House, which are intended to accelerate growth, create employment and ease the cost of living for Kenyans. 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."
}