Inside Politics

Yatani told to form team to audit national debt register

Monday, March 29th, 2021 00:00 |
Acting Treasury Cabinet secretary Ukur Yattani

Mercy Mwai @wangumarci

National Treasury Cabinet Secretary Ukur Yatani has been told to form a national task force to review the national tax systems and audit the national debt register and report to Parliament within three months.

Members of Parliament want Yatani to engage an independent audit consultant to help tackle the country’s debt crisis.

Coming as Kenya eyes $1 billion (Sh109.8 billion) and another €1 (Sh129.9 billion) through Eurobond sales, piling more pressure on the country’s public debt estimated at Sh7.28 trillion shillings by the end of December, 2020, it shows the country’s dire need for fiscal discipline.

Debt ceiling

Already, National Treasury has plans to lift the debt ceiling above Sh9 trillion to accommodate anticipated fiscal deficit in the budget amid dwindling collections from the taxman.

In a report tabled in the National Assembly, the members of Public Accounts Committee (PAC) regretted poor maintenance of the public debt records which makes it difficult to ascertain the status of books of accounts. 

They noted that the poor maintenance of the records bacame evident following the revelations by Auditor-General Nancy Gathungu that there were variances between figures reflected in the loan registers, other supporting schedules and the financial statements.

“The Cabinet Secretary for the National Treasury and Planning should, within three months of tabling and adoption of this report, form a national task force on public debt and engage an independent audit consultant to audit the national debt register and report to Parliament within three months,” reads the report in part.

The recommendation by the committee came even as it expressed concern that the outstanding amount of public debt has increased over the years from Sh2.3 billion reported in the year 2013/2014.

Members of the committee regretted that public debt has been accumulating at the rate of 20 per cent per year over the five-year period.

According to the Medium-term Debt Strategy paper 2021, the nominal stock of public debt was Sh7.3 billion or $65.6 billion as of the end of December 2020, equivalent to 65.6 per cent of gross domestic product (GDP).

A surge in foreign commercial loans is visible despite the government previously saying it would focus on concessionary borrowing to avoid a pile up of expensive external debt.

The MPs also want section 64 (2) of the Public Finance Management (PFM) Act 2012 to be amended to obligate National Treasury to prepare and publish every quarter an up-to-date national debt register.

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