Kenyan President William Ruto has asked Parliament to pass a soon-to-be-tabled supplementary budget bill to enable his new administration attain some of the key promises he made in his campaign pitches and reshape the country’s fiscal environment.
Speaking on Thursday during his first address to a joint sitting of the Senate and National Assembly, the president said the country’s fiscal space is currently very strained and cannot accommodate the achievement of the said agenda in his manifesto.
The additional budget will mainly help the government allocate extra funds to the judiciary to improve its autonomy and establish the ‘hustler fund’ – meant to improve access to low-cost credit for small-scale traders, Dr Ruto said.
“I will be seeking additional resources to support the bottom-up scaling of justice and empower the Judiciary to acquire capacity and develop the infrastructure needed to more efficiently adjudicate and expeditiously conclude corruption cases,” he said.
The president had earlier said the judiciary will be allocated an extra $25 million every financial year, and the ‘hustler fund’ will cost the exchequer and extra $414 million annually.
Affordable credit, Ruto said, is a “significant step towards unlocking billions of shillings needed to spur economic activity,” adding that there is need to shift the Credit Reference Bureau’s approach of blacklisting bad debtors to a credit scoring system.
At the same time, the president lamented the country’s consistent budget deficit that has always forced the government to rely heavily on debt, a situation he said must cease. He called for a restructuring of the country’s fiscal landscape.
“The Government should never borrow to finance recurrent expenditure. This is not right, prudent or sustainable, it is simply wrong. We must bring ourselves back to sanity,” Dr Ruto said.
“Over the next three years, we must reverse this and go back to the situation where government contributes to the national savings effort by keeping recurrent expenditure below revenue.”
Amongst the recommendations he has made to reverse the trend are the reduction of the current fiscal year’s budget by about $2.5 billion and making reforms in the tax framework to increase revenue collection.
“I am committed and determined to ensure that our tax system is responsive to the needs of the economy. It must be equitable, efficient and customer-friendly,” Ruto said.
The president also asked legislators to seize the opportunity to “fully take up its role in resolving the systemic issues that limit access to affordable homes and affordable financing.”
“I also wish to express our intention to bring to this House, legislative proposals to provide a framework for a housing off-take plan,” he said, adding that they will create incentives for more investment into the government’s housing strategy.