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Kenya reduces government spending under new administration

According to the most recent statistics, the cost of running the national government in Kenya declined slightly in the first quarter of the current fiscal year.

During the three-month period ending in September, the Ruto administration in Kenya allocated a total of Sh268.10 billion for administrative, operational, and maintenance expenses, as well as salaries and compensation. This marked a 2.90 percent decrease compared to the Sh276.11 billion spent during the same period the previous year.

The year-on-year reduction of Sh8.01 billion in day-to-day operational costs for various government functions, including the administration, Parliament, the Judiciary, and independent bodies, is primarily attributed to reduced election-related expenditures following the conclusion of contentious elections in the first quarter of the previous fiscal year.

According to data provided by Treasury Cabinet Secretary Njuguna Ndung’u, the recurrent expenditure for the Independent Electoral and Boundaries Commission (IEBC) decreased significantly from Sh10.33 billion to Sh544.52 million. This reduction highlights the financial impact of traditionally high-stakes elections on taxpayers.

Excluding the recurring costs of the IEBC, the national government’s operational expenses remained largely unchanged compared to the prior year, showing a modest increase of 0.66 percent, equivalent to Sh1.77 billion, totaling Sh267.55 billion.

The escalating costs of servicing the national debt have now exceeded the expenses associated with government operations, maintenance, and employee compensation. This underscores the consequences of the commercial loans obtained over the past decade to fund critical infrastructure projects such as roads, bridges, power plants, and a new railway line.

For instance, during the three-month review period, debt servicing consumed Sh347.22 billion, surpassing the daily cost of administering the government, which includes salaries and wages, by 29.51 percent, or Sh79.13 billion.

Since assuming office a year ago, the Ruto administration has grappled with the challenge of reducing recurrent expenditures, while pledging to cut down the previous administration’s spending by up to Sh300 billion in the preceding fiscal year. This was evident when the recurrent expenses for the fiscal year ending in June exceeded the budget planned during Uhuru Kenyatta’s administration by Sh43.17 billion.

The Head of the Public Service, Felix Koskei, announced that the State will no longer reimburse expenses incurred by government officials for benchmarking trips, study visits, training, capacity-building initiatives, research, academic meetings, and symposia. This forms part of renewed efforts to control the growth of recurrent expenditures.

Additional expenses related to conferences, meetings with open enrollment, side events, exhibitions, committee and association meetings, and related activities will also be reduced as part of the new austerity measures.

Mr. Koskei emphasized, “Public institutions interested in attending any events falling under the mentioned categories are required to explore virtual participation options where available. Alternatively, they can engage the Ministry of Foreign and Diaspora Affairs to ensure the on-site participation of diplomatic officials in the relevant host country.”


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