The nominee for the National Treasury and Planning John Mbadi has committed to creating a statutory debt register, pledging to work within legal boundaries, even if it means pushing for new legislation to disclose who Kenya owes and how much, if approved.
“Our major concern has been growing public and external debts. Some of the people or institutions owed do not want to be known. Why, if the debts are genuine?” Mbadi questioned.
Responding to the Parliamentary vetting committee, Mbadi said that while Kenya’s current debt has reached Sh10.5 trillion, some of the debts are questionable and the Treasury has not been forthcoming about the creditors.
“We must, as a matter of transparency, create a register of all statutory debts. If it’s the World Bank, African Development Bank, Eurobond, or China, we must know the creditors,” Mbadi asserted. He stressed the importance of Kenyans knowing about these debts because taxpayers are ultimately responsible for repaying them.
“It can’t be a blanket pay all the time. You must know what you are paying for, which is why I propose that external borrowing to fund budget deficits must focus on specific projects,” he said.
Tracking funds
Mbadi attributed the current debt issues to a shift in 2014 when the government began borrowing to finance budget deficits rather than for specific projects. “This system of borrowing for general purposes makes accountability a nightmare,” he stated, acknowledging the difficulty of tracking funds used for general expenditures.
The nominee proposed reforming fiscal policies at the National Treasury to link loans directly to projects, making it easier to ensure accountability.
“I will do that because we should link projects to loans, not on general purposes, for ease in accountability,” Mbadi said, emphasizing the need to restructure debts and manage debt liability.
Mbadi also promised to implement radical tax collection measures at the Kenya Revenue Authority (KRA), including retooling staff to enhance efficiency. This includes sealing porous borders where Kenya reportedly loses millions due to smuggling.
“We will find all means to stop this,” he assured.
He highlighted the importance of fighting graft, recalling a statement from former President Uhuru Kenyatta that the country was losing almost Sh2 billion daily to corruption.
Mbadi proposed amending future Finance Bills, noting that the current omnibus bill includes various sections like customs, excise duty, import duties, fees, and levies.
“Some of these bills can be brought to Parliament, debated, and legislated into law specifically instead of lumping them together,” said Mbadi.
“We must not allow general borrowing without specificity going forward,” he stated.
