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Cabinet Secretary for National Treasury and Economic Planning, Njuguna Ndung’u, has addressed the pressing financial challenges faced by the government.

He highlighted increased demands for expenditure and the limited options for financing.

CS Ndung’u on gov’t problem

Speaking at Parliament buildings while presenting the 2024/2025 budget, Ndung’u outlined a three-phase problem.

The first issue, he explained, is the increased demand for government expenditure, which necessitates financing through either taxes or debt.

The second issue involves the limitations and constraints on public debt accumulation and the debt-carrying capacity of the economy.

The final issue is the difficulty in mobilizing higher tax revenues, which is critical for meeting the government’s financial needs.

“We have one major problem that has three phases. This problem is as follows: there are increased demands for increased expenditures from the government, which means either we finance that through taxes or debts,” Ndung’u said.

“The second dimension of this problem is that there are limitations and constraints imposed in terms of public debt accumulation and the debt-carrying capacity of the economy. Third and more fundamentally, there are limitations in terms of mobilizing higher tax revenues, which is quite critical from our side.”

In his budget presentation, CS Ndung’u emphasized the government’s commitment to accelerating the implementation of policies, programs, and interventions under the bottom-up economic transformation agenda.

To achieve these goals, the government plans to enhance agricultural transformation and support Micro, Small, and Medium Enterprises (MSMEs).

The government aims to provide affordable housing and settlements, achieve Universal Health Coverage (UHC), and support the growth of the digital superhighway and creative economy. These initiatives are expected to drive job creation, a key component of the government’s agenda.

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