Kenya: Supplementary Budget Raises Concern in House

President Uhuru Kenyatta presses the switch for power transmission from Loiyangalani-Suswa line during the inauguration of the Lake Turkana Wind Power project on July 19, 2019.

The Treasury has caused jitters in the National Assembly after it presented Supplementary Budget III just seven days to the end of the 2019/20 financial year.

When new Majority Leader Amos Kimunya tabled it on Tuesday afternoon, Speaker Justin Muturi appeared to be taken aback.

"I hope the National Treasury knows that we have seven days to the end of the financial year," Mr Muturi said as MPs murmured loudly.

Already the Budget and Appropriations Committee has summoned Treasury Cabinet Secretary Ukur Yatani to appear before it today and defend the supplementary budget.

The committee will be chaired by Eldama Ravine MP Moses Lessonet after Kikuyu MP Kimani Ichung'wah was removed as chairman in the recent Jubilee purge.

According to the estimates, the Treasury has allocated Sh1.8 billion to the Transport ministry for the Nairobi commuter train and Sh1.5 billion to the Interior ministry for secure communication and surveillance systems.

To entice MPs, Sh1.7 billion has been allocated to the Parliamentary Service Commission for refurbishing buildings and the construction of the multi-storey MPs' office block.

The Sh3 billion that had been ring-fenced by the budget committee for all hospitals handling Covid-19 patients has been raided in the supplementary budget. The money was to be used to cushion patients from being charged for their treatment.

Now, the Treasury has reallocated Sh2 billion from the budget to procure Covid-19 testing kits and masks, among others. The purchase of these items was allocated funds in the Supplementary Budget II and was to run until June 30.

Mr Ichung'wah said the constant revision of the budget could be an indication of lack of realism in the country's revenue estimates during the budgeting process.

"The country needs to have credible budgets anchored on realisable revenue targets," he said.

The new estimates include Sh5 billion that the President announced will be allocated to county governments to enhance their fight against Covid-19.

The money has already been allocated, meaning that the Treasury is seeking post-fact approval.

The supplementary budget also contains Sh1.5 billion allocated to the Labour ministry for stipends to the elderly.

What is bound to raise eyebrows, however, is Sh1.6 billion allocated to the Ministry of Energy for the controversial 435-kilometre Suswa-Loiyangalani power evacuation line in disregard of the recommendations of the budget committee.

The committee had stopped further payments for the project until a special audit is concluded. The construction of the power line started in 2014 but stalled after a Spanish contractor went bankrupt.

The contract for the line was structured in a manner that Lake Turkana Wind and Power (LTWP) would be paid a penalty for any delay in the power line completion, which essentially means that the country is paying for the power that it does not consumer "because their (LTWP) turbines are running".

The estimates tabled in the House are in line with Article 223 of the Constitution. However, it is not clear why this was so urgent that it could not wait until July 1, when the new financial year (2020/21), begins.

Lawmakers and observers are also asking why these changes were not included in the Supplementary Budget II, which was passed two months ago.

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