This archive report was first published on 26 July 2019.
As the country grapples with a massive public debt and a huge wage bill, the national government has announced plans to freeze development projects. This move is aimed at protecting the economy from further strain.
According to a letter dated July 23, 2019, Head of Public Service Joseph Kinyua directed CEOs of parastals and heads of Semi Autonomous Government Agencies (SAGAs) to tighten their belts on spending.
“The government is currently seized with the alignment of the Financial Year 2019/2020 Budget towards support of the Big Four Agenda,” Kinyua stated. In furtherance of the same, the cabinet has directed all state corporations and SAGAs to spend only an amount equivalent to one quarter of last year’s recurrent budget.
This amount should support all priority expenses over the first quarter ending September 30, 2019. A moratorium has been issued, placing all capital expenditures in abeyance until otherwise directed. During the moratorium period, no capital expenditure is to be undertaken unless the capital expenditure is an ongoing project and is specifically approved in writing by the National Treasury,” reads the directive.
During the period, the budgets of the state corporations and SAGAs will be reviewed and rationalised by a team to be appointed by the president. This move comes in the wake of the arrest and charging of former Treasury Cabinet Secretary Henry Rotich and his Principal Secretary Kamau Thugge with circumventing the law to facilitate the theft of Ksh19 billion in the Arror and Kimwarer dams scandal.
