President William Ruto has directed the National Treasury to prepare a mini-budget for the financial year starting in July after rejecting the 2024 Finance Bill, which was expected to raise an additional Sh346 billion.
President Ruto on Friday signed the 2024 Fiscal Appropriation Bill, which allows the national government and provinces to spend even as the Provincial Allocation and Revenue Bill is referred to Parliament to reduce allocations.
Dr Ruto said he signed the appropriation bill “to ensure continuity of government operations, especially in the delivery of critical services.”
“I have therefore approved the 2024 Appropriation Bill and directed the National Treasury to immediately prepare supplementary estimates to reduce expenditure by the amount of revenue that the rejected Finance Bill was expected to generate,” he said in a statement.
“The reduction in expenditure, amounting to Sh346 billion, will be borne equally by both levels of government: the national and county governments. As far as the national government is concerned, the reduction will be borne by the executive, legislative, judicial and our constitutional commissions,” the Head of State added.
In his speech, President Ruto rejected the Finance Bill on Wednesday and called for spending cuts to cover the expected revenue shortfall, including allocations to the executive.
He said, “I direct additional immediate austerity measures to reduce spending, starting from the Executive Office of the President down to the entire executive arm of the government. I direct the reduction of operational spending in the presidency to eliminate allocations for secret voting, and to reduce the budget for travel, hospitality, purchases of motor vehicles, renovations, and other expenses.”
He also directed the National Treasury to immediately submit amendments to Parliament to the Revenue Division Bill 2024 to reflect the revenue reduction resulting from the rejected Finance Bill.
President Ruto was forced to reject the Finance Bill in the wake of nationwide demonstrations that saw demonstrators storm Parliament buildings even after clashes with police left 23 dead and dozens injured.
Treasury Bulletin
Meanwhile, National Treasury Secretary Njuguna Ndung’u sent a circular to all accounting officers on Friday directing them to limit spending to 15 percent of the allocated budget until a mini-budget is drafted and passed into law.
“Accounting officers have therefore been directed to limit the expenditure of the 2024/25 financial year budget… to only critical and essential services,” Professor Njuguna said.
He added, “Accounting officials have been directed not to exceed spending by 15 percent of the allocated budget until the Supplementary Estimates No. 1 for the 2024/2025 fiscal year is allocated.”