What do the 2018/2019 national budget estimates mean for Kenya's poorest households?

As Kenya prepares for the budget reading tomorrow, Development Initiatives has published a new report: Pro-poor analysis of Kenya’s 2018/19 budget estimates: what do the numbers tell us? The Kenya national budget for 2018/19 is an opportunity to understand how the government intends to allocate resources to its development priorities; contributing to a reduction in poverty and ensuring no one is left behind. If the needs of the poorest people are not well targeted by government resources, or if insufficient tax is raised (or raised in ways that penalise the poor), and if welfare support systems are under or inefficiently financed, people with most need are at the greatest risk of being left behind.

The government plans to spend Ksh 2.53 trillion – an increase of 8.75% from 2017/18 fiscal year. Revenue collection is projected at Ksh 1.92 trillion. Fiscal deficit is expected to reduce by 10.21% to Ksh 562.75 billion despite the increase in spending. The deficit will be financed through domestic and external borrowing. Development expenditure has increased by 12.77% to Ksh 657.29 billion compared with 2017/18. This amount is equivalent to 25.95% of the budget, which is less than the minimum threshold of 30% provided for by the Public Finance Management Act, 2012. And transfers to county governments have increased by 15.13% to ksh 372 billion.

Angela Kageni, Head of Development Initiatives’ Africa Office says: “as the government rolls out the Big Four Agenda, access to and use of quality data in planning and budgeting should be prioritised. Lack of adequate and reliable data was mentioned in the 2018/19 programme-based budget as a constraint to allocation of funds to institutions that are implementing basic education programmes for instance. More regular collection of disaggregated data through measures such as improving interoperability and automatic data collection should be considered.”

Development Initiatives’ analysis provides an in-depth look at allocations to sectors that are considered to have a direct reach and effect on the poor population. It shows that although the Kenyan government is allocating more resources to pro-poor sectors in 2018/19 compared with previous years, these resources still do not adequately address the needs of the most vulnerable citizens. Financial gaps in many priority areas may result in Kenya being off-track to meet the targets set as part of national development priorities and Sustainable Development Goals.

The analysis in the report is limited to the national government budget estimates. Deeper insights on allocations to pro-poor sectors could be explored by analysing county government budgets as well.

Contact

Henry Odhiambo, Engagement and Partnerships Manager, Development Initiatives

T: +254 (0) 20 272 5346

E: [email protected]

Spokespeople available on request:

Angela Kageni, Head of Africa Office, Development Initiatives

Read the full report and briefing