NAIROBI, Kenya, Feb 9 – The Government is projecting to collect Sh1.7 trillion shillings in revenue for the 2017/2018 financial year against a record budget of Sh2.62 Trillion.
In a briefing to the Cabinet, Treasury CS Henry Rotich said donor commitments have been firmed up and disbursements are expected to hit Sh256 billion in loans and grants.
Rotich has said the 2017/2018 budget will continue to focus on the 2nd Medium Term Plan of Vision 2030 and the Government’s priorities under a five-pillar transformation agenda.
The Cabinet has also approved Sh100 billion for salary increases for all Public Servants starting July 2017.
“The allocation is part of the harmonization of public sector salaries and allowances including civil service pension, house and hardship allowances, recruitment of 10,000 police officers and 5,000 teachers,” reads the statement from State House.
The allocations in the FY 2017/18 Budget are aligned to the approved Budget Policy Statement 2017 that commits to ensure sustainable debt and improvement in expenditure management.
“In particular, we plan to gradually lower our fiscal deficit (by closing the gap between revenue and expenditure), over the medium term, while at the same time providing sufficient room to finance productive expenditure so as to sustain equitable growth,” says Rotich.
The Government is banking on the on-going reforms in tax policy and revenue administration to improve revenue collection, even as it limits borrowing to international markets.
“Other alternative sources of financing the government may explore over the medium term include; the Islamic financing instruments, the Samurai market, Panda bonds and Diaspora bonds,” states the policy statement.