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{
    "id": 909842,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/909842/?format=api",
    "text_counter": 609,
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    "content": "within a single financial year especially where the proposed expenditures were foreseeable and could have been included in the Budget. This concern is quite clear from our perspective as the Budget and Appropriations Committee and you will realise some of the things that have been disallowed in this supplementary budget, some of which I will be going through like those that touch on the Salaries and Remuneration Commission (SRC), are issues that cannot be classified as things that would have been foreseen. Something like the purchase of motor vehicles is not something that would not have been budgeted in this year’s financial estimates of 2018/2019. So, as a House, we must really discourage this tendency of having too many supplementary estimates. The Second Supplementary Budget Estimates for the Financial Year 2018/2019, have been tabled at a time when the country is experiencing inflationary pressures on account of food shortage and fuel prices. The current account deficit is also facing significant pressure from unfavourable commodity prices, though it has been performing well on account of high forex inflows through the Diaspora remittances from our fellow countrymen and women. They have done well in Diaspora remittances. I want to encourage our fellow countrymen out there to continue with those remittances. The remittances are doing well in cushioning our economy. The revenue collection already has a reported performance of Kshs1,179.6 billion against a target of Kshs1,277.3 billion as at March, 2019. This indicates a revenue under-performance of Kshs97.7 billion as at the end of March, 2019. If this trend persists, and given the ongoing governance issues in the Kenya Revenue Authority (KRA), it will be difficult for the Government to plug this deficit and revenue under-performance. By the end of June, 2019, it is likely to be in the range of Kshs100 billion – Kshs122 billion as estimated by the Parliamentary Budget Office (PBO). We have expressed this concern in the FY 2019/2020 Budget Estimates on the realism of our revenue projections. This will come to the fore during the implementation of the Budget in the course of the year. This was evident in the financial estimates of 2018/2019. As we speak, we are already under-performing on the Budget. As I mentioned, there are critical governance issues at the Kenya Revenue Authority (KRA). It is important to note that there is a change of guard at the KRA with a proposed new Director-General. It is our prayer and hope that the new Director-General will, indeed, work to ensure that in the remaining few days to the end of the FY 2018/2019, he not only bridges the gap of what is reported as under-performed revenue, but also surpasses the revenue projections for this financial year. We know in the last month of the financial year, people do their tax returns. A number of Kenyans send their tax obligations. We are asking the KRA to ensure that we realise revenue projections. So, as we begin the new Financial Year 2019/2020 beginning July of this year, they will also work to ensure that what is reflected in our estimates as revenue projections comes to fruition and be able to achieve or surpass the revenue projections. I do not want to go through the whole Report, but it is important to note that the Second Supplementary Budget proposes to increase the recurrent budget by Kshs70.85 billion, whereas the development budget has been reduced by Kshs5.82 billion. Thus, the effect is an increase in the supplementary budget by approximately Kshs65.03 billion. This, as I said, is coming towards the tail-end of the financial year. It should be noted that this increase brings the Second Supplementary Budget back to almost the same level as the 2018/2019 Budget, despite the projected revenue under- performance. Therefore, the Committee is concerned that such a significant increase in the recurrent budget could undo the gains of the austerity measures instituted under Supplementary One. Indeed, most of the recurrent budget increments are to cater for salary shortfalls as well as The electronic version of the Official Hansard Report is for information purposes only. Acertified version of this Report can be obtained from the Hansard Editor."
}