CoB: State spent the lion’s share of budget on wages

Wednesday, July 8th, 2020 00:00 |
Controller of Budgets Margaret Nyokang’o. Photo/PD/FILE

Peter Leftie

The national government is on the spot for allocating a whopping Sh315 billion on salaries and allowances for public servants between last July and March this year.

According to the report of the Controller of Budget (CoB) for the current financial year 2019-2020, the amount gobbled 40 per cent of the total budget set aside for recurrent expenditure, continuing a trend where the government has consistently spent the bulk of its budget on paying salaries and allowances at the expense of development projects.

The report says the Teachers Service Commission (TSC) reported the biggest expenditure on salaries and allowances at Sh181.7 billion, more than half of the government’s budget for personal emoluments during the period.

Other big spenders of recurrent budget were semi-autonomous government agencies, which gobbled Sh190 billion, almost a quarter of the total recurrent budget.

Once again, the CoB, Margaret Nyakang’o also fingered the national government for allocating colossal amounts for travelling and hospitality.

In the first nine months of the current financial year, Sh12.8 billion went towards travel while Sh4.5 billion was set aside for hospitality, according to the report.

It notes that the national government received Sh1.8 trillion from the exchequer to fund its ministries, departments, agencies as well as the county governments, an increase of Sh700 billion from the 2018-2019 financial year which stood at Sh1.7 trillion.

“The Exchequer issues comprised Sh.242.2 billion for development programmes, Sh1.3 trillion for recurrent activities (Sh.723.8 billion to government Ministries, Departments and Agencies (MDAs) recurrent programmes and Sh579.4 billion towards Consolidated Fund Services), and Sh207.3 billion to County Governments as shareable revenue from the National Government,” the report states.

Out of the Sh1.8 trillion, the national government allocated Sh775.6 billion to it’s various ministries, departments and agencies and Sh518.3 billion to Consolidated Fund Services.

Development expenditure was on the other hand allocated Sh463.6 billion, according to the report. 

Out of the development budget, Sh255 billion went to the semi autonomous government agencies while another Sh65.2 billion went towards construction and civil works. Another Sh44.5 billion went towards refurbishing of buildings and infrastructure, states the report.

The report, however,  reports that during the period under review, development expenditure registered some growth while recurrent expenditure declined compared to the same period in the previous financial year, an indication that the government was determined to break the cycle and allocate more resources to development activities.

“However, development expenditure recorded growth in absolute amounts (Kshs.463.6 billion), compared to Kshs.395.3 billion recorded in a similar period financial year 2019/20 signifying the government’s efforts to focus on development activities,” observes the CoB.

The report, however,  points out several factors that hampered the effective implementation of the budget during the first nine months of the financial year.

It noted delays by some MDAs to submit quarterly financial reports to the CoB and the adverse effects visited upon the economy following the outbreak of the Coronavirus disease in March this year.

Government ministries also failed to report on programme and project achievements to the CoB, the report adds. 

The CoB directed government accounting officers to ensure expenditure reports are submitted not later than 15 days after the end of each quarter of the financial year to eliminate such delays going forward. “Regarding the economic effects occasioned by the Covid-19 disease, there is need for development of a framework for continuous monitoring of the economy by the respective institutions and to address emerging issues by government,” the CoB advises.

The CoB further advises government accounting officers to ensure that the reports submitted contain sufficient information on achievements of programmes and projects as outlined in the Programme Based Budget framework.

The CoB notes that the Covid-19 pandemic while being primarily a health crisis with far reaching economic ramifications, the responses instituted to control its spread have disrupted millions of livelihoods with disproportionate impact on poor households and small and informal businesses. 

Nyakang’o warns that the pace of this disruption is likely to accelerate in the months ahead.

“Given the disruptions occasioned by the decisive actions taken by government to contain spread of the Covid-19 disease, it is clear that the measures will impact on all sectors of the economy,” she states.

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