Kenya's National Assembly approved the 2022/23 government budget estimates, preventing a potential financial crisis that could have disrupted the August 9 general election. The Sh2.1 trillion expenditure plan, finalized in the Committee of Supply, includes Sh44.18 billion allocated for election operations, with Sh42 billion managed by the Independent Electoral and Boundaries Commission (IEBC).
The approval followed intense debates over fiscal constraints, including an Sh846 billion deficit, Sh8.6 trillion in public debt, and a Sh9 trillion debt ceiling established through 2019 amendments to the Public Finance Management (PFM) regulations. Lawmakers faced pressure to address these challenges before finalizing the Appropriations Bill, which would grant the government legal authority to access funds from the Consolidated Fund.
Debt Ceiling Controversy ¶
Parliamentary leaders clashed over whether to amend the Sh9 trillion debt ceiling—set under 2015 PFM regulations—to allow additional borrowing or prioritize passing the budget. The current limit restricts borrowing to Sh400 billion, leaving a Sh446 billion gap in the development budget. Speaker Justin Muturi emphasized the urgency of resolving the issue before the National Assembly adjourns in June 2022.
A proposed Public Finance Management (Amendment) Bill seeks to grant the Cabinet Secretary for Finance flexibility to exceed the debt limit under specific circumstances, such as currency depreciation or health crises. Critics, including Nominated MP Godfrey Osotsi, argue the measure undermines parliamentary oversight of public debt management.
Meanwhile, draft regulations aim to recalibrate the debt ceiling from a fixed Sh9 trillion to 55% of GDP. However, parliamentary committees face time constraints, as the National Assembly is set to adjourn on June 9, 2022, with the Senate resuming sittings on June 7. A failed mediation process on the PFM Bill could delay critical reforms until the next parliament, forcing the government to rely on supplementary budgets to manage 2022/23 expenditures.
