Ensure austerity steps fulfil intended purpose

Monday, September 16th, 2019 19:25 |
Treasury Cabinet secretary Ukur Yattani. Photo/File

The National Treasury has yet again announced austerity measures aimed at trimming unnecessary State spending that consumes a huge part of the national budget.

The target is to plug the budget deficit amid slower-than-estimated revenue growth.

Although realising the objective can be achieved through belt-tightening measures, raising taxes to address the challenge should be the last option for Treasury mandarins. 

Budget cuts are being effected even as Treasury acting Cabinet secretary Ukur Yattani disclosed last week that they expected a slight decline in  growth this year—from the projected 6.3 to  6.0 per cent.

Although the Treasury has zeroed in on the non-crucial budget allocations such as overseas trips by State officials and advertising, the measures should cascade to all the 47 counties.

In almost every report produced by the Controller of Budget and Auditor-General, counties and their leadership have been put on the spot over mismanagement of resources allocated to them.

It has largely been a tale with little indication of any efforts to enhance accountability and push for recovery of lost funds.  

Curbing spending is a noble idea, but this is not the first time the government has attempted to go this route. Previous moves to ban, for instance, the use of fuel guzzlers, did not yield much. 

Sometime back, suspended Treasury CS Henry Rotich introduced a raft of measures which he said would curb spending but little was achieved as most reforms he introduced were flouted with criminal impunity.

So, what  measures will Yatani put in place to ensure his directive is adhered to and achieve the intended purpose? Kenyans would like to see commitment on the part of Treasury to ensure prudent use of public resources.

If enforced, the new austerity measures could help restore stability in the country’s finances. The directive, therefore, should cut across all arms of government, including Parliament and Judiciary.

The cuts will plug the budget deficit and put the economy on the recovery path.  

The austerity steps should go beyond foreign travel to also include conferences in five-star hotels, purchase of vehicles and creation of new positions. But this will require fidelity to achieve.

In the long-term, however, Kenya Revenue Authority should widen the tax bracket to boost revenue collection.

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