Education wins big in Ruto’s Sh3.6tr budget

Education and security sectors are set to be the biggest beneficiaries in President William Ruto first budget — which stands at Sh3.6 trillion — and which will be presented to Parliament in June. 

According to a budget brief shared with editors after a Cabinet meeting at State House, Nairobi, yesterday, the education sector will get Sh568.9 billion. It will be followed by the National Security sector at Sh338 billion, roads at Sh239.5 billion and health, which has been allocated Sh125.5 billion. 

Other big winners are environmental protection of water and natural resources, which have been promised Sh115.1 billion. This will be followed by equity, poverty reduction, women and youth empowerment which will get Sh78.7 billion. 

Agriculture and food security will be allocated Sh47.3 billion, transport Sh43 billion, social protection and affirmative action Sh38.5 billion, and manufacturing and industrialisation Sh22.8 billion. Sports and culture, recreation and tourism will be allocated Sh22.1 billion. 

“The overall total gross expenditures in the financial year 2023/24 budget amounts to Sh3.6 billion,” reads the estimates. 

Estimates tabled in the National Assembly last evening by Majority Whip Sylvanus Osoro show the Executive will be allocated the lion’s share of the budget at Sh2.2 trillion. Parliament will be the second arm of government with the highest allocation at Sh40 billion while the Judiciary — including the Judicial Service Commission (JSC) — will be allocated Sh22.9 billion. 

According to figures from the National Treasury, revenue collection is projected to grow to Sh2.89 trillion (about 17.8 per cent of the national wealth) in the next financial year. This will represent an increase from the current financial year, which stands at Sh2.53 trillion and is expected to rise further to Sh.4.2 trillion (18.3 per cent of national wealth, also known as the Gross Domestic Product (GDP)) by 2026/27. 

From the Sh3.56 trillion Budget, recurrent expenditure will comprise Sh2.47 trillion while development will take Sh689.1 billion. 

The fiscal deficit is projected at Sh663.5 billion, a reduction of more than Sh450 billion from FY 2022/23 which stood at Sh.1.12 trillion (6.2 per cent of GDP). 

“Currently, the fiscal deficit is estimated at 5.7 per cent of GDP, having improved from 6.2 per cent in the previous year, owing to reduced borrowing, and expenditure re-organisation,” says the Treasury. 

The Consolidated Funds Services (CFS) have been allocated Sh986.2 billion, comprising Sh628.3 billion for domestic interests payments and Sh146.9 billion for foreign interest payments. Another Sh 210 billion will be spent on pension payments, salaries and allowances while the county allocations include Sh385.4billion in sharable revenue andSh44.2 billion in conditional grants.  

Junior secondary

“We expect Parliament and Judiciary to adhere to the ceilings as set out in the 2023 Budget Policy Statement,” says the report.  From the Sh568.9 billion allocated to education, Junior Secondary School (JSS) capitation will get Sh15.5 billion, free day secondary school education — including the National Health Insurance Fund will get Sh65.4 billion, Free Primary Education Sh12.5 billion, school feeding programme Sh3.9 billion, Teachers Service Commission Sh 316.7 billion, construction of classroom in JSS Sh2 billion, training of teachers under Competence-Based Curriculum programme Sh1.3 billion. 

Others are the recruitment of 20,000 interns, which has been allocated Sh4.8 billion, university education Sh98.8 billion, construction on Technical  Training Institutes (TTIs), which is currently ongoing, will get Sh 1.9 billion. The Subsidy to Kenya National Examination Council (KNEC) waiver will be Sh5 billion, Higher Education Loans Board (HELB) Sh17.8 billion, recruitment of Technical Institutes and Vocational Training (TIVET) instructors’  Sh 720 million. Meanwhile, construction of  52 TTIS will Sh1 billion, primary and secondary infrastructure Sh1.5 billion, digital literacy in secondary schools Sh400 million while capitation to TIVET students has been allocated Sh5.2 billion 

In the security sector,  defence will get Sh143.2 billion,National Police Service Sh 99 billion. National Intelligence will be given Sh43.8 billion, leasing of police vehicles Sh10.7 billion,medical insurance for police officers and prison officer Sh 5.6 billion, police modernisation programme Sh500 million and Prison Service Sh31.3 billion. 

In the manufacturing sector, the hustler’s fund has been allocated Sh10 billion, the Constituency Industrial Development Centre Sh172 million, while Kenya youth empowerment and opportunities project has been allocated Sh300 million. 

In agriculture, fertiliser subsidy has been allocated Sh4.5 billion, aflatoxin management Sh106 million, sugar reforms Sh150 million and miraa industry revitalisation project Sh96 million.

Under the Ministry of Health, the rollout of Universal Health Coverage has been allocated Sh11.7 billion, free maternity healthcare Sh4 billion, Regional Cancer Centres Sh155 million, and Covid emergency response project Sh3.7 billion. 

Meanwhile, the 47 counties will receive Sh385 billion in the next financial year after President William Ruto assented to the Division of Revenue Bill, 2023, last evening.  The County Equitable Share has increased by Sh15.4 billion, up from the current Sh370 billion. 

The Division of Revenue Bill, 2023, is meant to provide for the equitable division of revenue raised nationally between the National and County Governments for the Financial Year 2023/24 as provided for in Articles 203(2) and 218 of the Constitution. 

In addition, counties will receive an extra Sh11.1 billion in conditional and unconditional allocations from the National government’s share of revenue, as well as an additional Sh33.2 billion from the proceeds of loans and grants to county governments. 

Division of revenue bill

Senators considered and passed the bill on April 20 without amendments in the form passed by the National Assembly thus paving the way for the Bill to be signed into law.  The allocation of Sh385 billion to counties in the next financial year is Sh15 billion more than the Sh370 billion allocated in the current financial year.  During last week’s vote, 25 legislators voted to pass the Bill without amendments, outnumbering Azimio la Umoja-allied leaders who had pushed for an amendment to give counties Sh407 billion.

 The enactment of the Division of Revenue Bill, 2023, now paves the way for the preparation of the annual expenditure estimates for FY 2023/24 and consequentially introduction of the Appropriation Bill, 2023 as provided for in Article 221 of the Constitution.

 This will ensure building up on the Government’s efforts to stimulate and sustain economic activity, mitigate the adverse impact on the economy and re-position the economy on a sustainable and inclusive growth trajectory. 

It will also be achieved through the implementation of a set of programmes under the Bottom–Up Economic Transformation Agenda to support economic recovery and provision of government service delivery.