Winners and losers in Ruto’s first Budget

Teachers, boundary review, social safety nets and the textile industry are some of the beneficiaries in the Sh3.6 trillion proposed budget for the 2023/24 financial year.

This comes after the National Assembly on Wednesday approved the report of the Budget and Appropriations Committee (BAC) on the 2023 Budget Policy Statement (BPS).

The adoption of the report now paves the way for the National Treasury to prepare and present to the National Assembly the budget estimates by April 30 as decreed by the Constitution and the Public Finance Management Act. 

The passage, however, spells bad news to the Kenya Universities and Colleges Central Placement Service (Kuccps) and private universities. 

Local borrowing

But the House has condemned the proposal by the National Treasury to finance the Sh720 billion deficit in the budget through the borrowing of up to Sh521 billion from the domestic market against an external borrowing of Sh198 billion, in a move that will crowd out the micro, small and medium enterprises from local credit.

About 31 private universities that receive exchequer releases to support government-sponsored students are now staring at a crisis after lawmakers yesterday banned Kuccps from placing students in private universities, a move that will cushion public universities from closure over financial difficulties.

“In the next cycle of placements (2023), the State Department of Higher Education and Research, through Kuccps, should not place new government-sponsored students in private universities,” the BAC report on BPS reads.

Teacher promotion

Teachers with higher qualifications, who have stagnated in the same job group for long, now have a reason to smile after the MPs approved Sh2.2 billion in additional allocation to the Teachers Service Commission (TSC) for the promotion of 14, 000 teachers in primary and secondary schools.

It was only last month when TSC advertised for the promotion of senior teachers in line with Career Progression Guidelines. 

The commission is seeking to promote deputy headteacher II for primary schools that have 7,720 posts; 2,733 headteachers for regular primary schools; 1,330 secondary teachers; 725 deputy principal II; 602 principals for regular schools; 224 deputy principal III for secondary schools; and 208 senior master II teachers.

There are also 73 vacancies for regular secondary school chief principals, 32 headteachers for special needs education (SNE), 22 deputy headteachers for SNE schools, 17 posts for deputy principal I, eight principal teachers for SNE and four chief principals for SNE schools.

TSC has also advertised 1,020 vacancies for teachers deployed as principals, deputy principals, teachers and deputy headteachers in arid and semi-arid lands (Asal) and hard-to-staff counties.

The Asal counties in this category are Baringo (Baringo North, Tiaty East, Tiaty West and Marigat sub-counties), Garissa, Homa Bay (Suba and Mbita), Kajiado (Mashuuru, Loitoktok and Kajiado West) and Kilifi’s Magarini Ganze areas.

The others are Isiolo, Kitui, Kwale, Lamu, Mandera, Marsabit, Narok, Samburu, Taita Taveta, Tana River, Turkana, Wajir and West Pokot. 

The National Government-Constituency Development Fund (NG-CDF) and the National Government Affirmative Action Fund (NGAAF) have been enhanced by Sh10 billion.

This means that NG-CDF, which is meant for the 290 constituencies, will get Sh9 billion on top of the Sh44 billion that was allocated in the current financial year, with NGAAF, which is controlled by 47 woman representatives, getting Sh1 billion on top of the Sh2 billion disbursed this financial year.

In the aviation industry, the MPs want the National Treasury to implement tax cuts by April next year to reduce the cost of spare parts. 

Capitation

There is a proposal to review basic education capitation to adequately fund schools within six months and approval of a policy on school infrastructure improvement funds as a conditional grant.

The Geothermal Development Company will also be facilitated to connect 206 Megawatts of power to the national grid by April 30. There is also a proposal to enhance the Inua Jamii stipend—cash transfers wired through mobile money—within three months. 

Boundaries review

The Sh7.2 billion additional allocation to the Independent Electoral and Boundaries Commission (IEBC) sets the stage for the review of electoral boundaries.

The allocation is above the Sh4.25 billion for the management of election processes in the event of by-elections and Sh1 billion for the construction of the Uchaguzi Centre.

The last boundary review, which created the current 290 constituencies, was undertaken in February 2012 by the defunct Interim Independent Boundaries Commission, then chaired by former Vihiga MP Andrew Ligale.

Article 89 (2) of the Constitution requires the IEBC to undertake delimitation of electoral boundaries between eight and 12 years, and the next phase, which should conclude by 2024, is to be guided by the 2019 national census report that placed Kenya’s population at 47.5 million.

The forthcoming boundaries review is expected to turn into a battle pitting leaders from populous regions against those representing expansive but less populated areas. Politicians from the Mount Kenya region have been pushing for one man one shilling on the grounds that despite their constituencies being populous, they have been underrepresented, a move that undermines the allocation of resources to the region.

The boundaries review matter was the subject of the failed Building Bridges Initiative process that sought to create extra 70 constituencies that would have seen Rift Valley get 23 new ones, Nairobi 12, Central Kenya 11 and Coast 10.

The adopted BPS report also undertakes to have the police air wing returned to National Police Service from the military by June 30, with more funding to aid the war on bandits and other crimes.

There is also Sh1.5 billion in additional funding to the national forensic laboratory at the Directorate of Criminal Investigations as the government commits to taking the war on crime to another level.

Anti-doping lab

In sports, the government promises to establish a World Anti-Doping Agency-accredited laboratory for tests.

It also seeks to introduce a wildlife compensation insurance scheme within six months and Sh1.3 billion for Rift Valley Textiles (Rivatex) to subsidise cotton development

The MPs’ move to block exchequer funding of private universities comes at a time when the government is struggling to fund public universities that are choked on debts amounting to over Sh56.1 billion

In the last four years, private universities have received grants from the exchequer worth Sh8.7 billion at the expense of public universities.

According to the Universities Fund, most public universities are on the verge of collapsing because of indebtedness and inability to pay statutory deductions, such as Pay As You Earn, NHIF and NSSF remittances for health insurance and retirement benefits respectively, as well as Sacco and bank loan repayments.

The government also plans to introduce digital economy tax reforms that will target the proliferation of digital finance solutions like M-Pesa transactions, and a review of charges on digital services on e-citizen. Job losses are also expected as the National Treasury reviews state corporations and Semi-Autonomous Government Agencies (Sagas) within three months.

The National Treasury also plans to review the list of all projects, with only those with high impact to be completed. Despite the biting hunger situation in the country, there was no allocation for relief food and rehabilitation programmes.

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