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{
    "id": 910321,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/910321/?format=api",
    "text_counter": 289,
    "type": "speech",
    "speaker_name": "Mr. Henry Rotich",
    "speaker_title": "The Cabinet Secretary for the National Treasury",
    "speaker": {
        "id": 13142,
        "legal_name": "Henry Rotich",
        "slug": "henry-rotich"
    },
    "content": "strategy; Resolution of tax disputes; and enhancing investigative capacity to support revenue collection. We expect the above administrative measures to significantly boost our revenue efforts. In the coming financial year, we expect revenues, including A-i-A of Kshs2.1 trillion. Expenditures and net lending are projected at Kshs2.8 trillion, leaving a fiscal deficit including grants of Kshs607.8 billion. In relation to the GDP, this deficit translates to 5.6 percent, a decline from 6.8 percent in FY 2018/19 and 7.4 percent for FY 2017/18. Hon. Speaker, the fiscal deficit of 5.6 percent of GDP in FY 2019/20 will be financed by net external financing of Kshs324.3 billion and net domestic financing of Kshs283.5 billion. We shall continue to remain on this planned path of reducing the fiscal deficit in the medium-term in order to create more fiscal space and to reduce the public debt. Resource mobilisation through borrowing will be in accordance with the Public Finance Management Act, 2012 and guided by the annual Medium-Term Debt Management Strategy, which this House approves annually, and which seeks to minimise costs and risks on public debt and borrowing. Official Development Assistance on high concessional terms will be preferred for some of the external financing while medium to long-term Treasury Bonds will remain the primary source for domestic financing. Hon. Speaker, Kenya continues to meet its debt service obligations promptly with no accumulation of debt arrears. Public debt is within sustainable levels and the debt burden is projected to decline over the medium-term as we implement fiscal consolidation plan. The loan proceeds we have contracted, primarily from our multilateral and bilateral development partners have been used to finance development expenditures including in such areas as ports, railway, roads, energy and water. This infrastructure is critical to the expansion of our potential growth and regional competitiveness, and in making Kenya the African hub for transportation, industrial and services sectors. Nevertheless, the borrowed resources must be used wisely. Accordingly, the recently established Public Investment Management Unit will be appraising all infrastructure projects before such projects are committed in the budget, in order to establish their value for money, affordability and economic return for the benefit of the current and future generations in line with the Constitution of Kenya. Hon. Speaker, we have constituted and strengthened the Public Debt Management Office at the National Treasury under a Director-General to be responsible for public debt management and operations. We have initiated a set of reforms to promote development of the domestic debt market, an important source of financing for our development programmes. In particular, we plan to roll-out measures to enhance transparency and predictability in the issuance and trading process for Treasury Bills and Bonds to enhance efficiency, lower costs and risks, as well as develop an effective yield curve for Government domestic debt securities. Given the importance of Eurobonds in our debt portfolio, we will strengthen the debt office to adopt modern liability management instruments to reduce cost and settlement risks, in addition to introducing an investor relations unit at the National Treasury. County governments in the coming financial year will receive a proposed allocation of Kshs371.6 billion, of which Kshs310 billion is the equitable share and Kshs61.6 billion will be conditional transfers, including Kshs38.7 billion from our development partners. I am well aware that the proposal I have outlined above on the Division of Revenue between the national and county governments is subject to negotiations under the Joint Mediation Committee established by the two Houses of Parliament. We look forward to the speedy conclusion of the mediation 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."
}