"Days when budgets were synonymous with austerity are long gone. Ours cannot be about budget airline, or budget hotel that invoke minding your pocket. Treasury’s budget has of late been about big time spending, like taking a five-star airline, living in a seven-star hotel; we are literary living large, well beyond our means. The Finance Minister no longer burns the midnight oil scratching his head to raise revenue to cover financing gaps; just borrow the deficit. And national priorities such as are set out by the Planning Ministry don’t matter anymore. Treasury determines where to put our money.
The 2012/2013 Budget is no different. It is big. It’s ambitious as ever. Government will spend nearly Sh1.5 trillion, well above the Sh780 billion in taxes it expects to raise. Last year, it spent about Sh1.2 trillion. Well, the Minister will borrow, and beg, the deficit. By 2014, he projects that our public debt will be Sh2 trillion. Our poverty levels going anywhere, but down. Unemployment is choking our youth. Free Primary Education is crumbling as teachers complain of lack of resources. Our health centres too are largely understaffed. Despite the billions, the rural folk unlike their urban elites don’t feel much change. True, we are building roads. Kids still flock to schools. But the drudgery of life for the ordinary person hasn’t changed an awful lot.
It’s largely about trivialising our national priorities, and extravagance and wastage in public service. In this budget, defense and national security services received a whooping Sh150 billion, which is 10 per cent of the total budgeted expenditure, one of the highest in Sub-Saharan Africa. Much of it will be spent in secret, away from public scrutiny, in a nation where high graft is glorified.
Food security though remains on the back banner. Contrary to the Africa Union recommendation that States spend above 10 per cent of the budget to boost agriculture, we are just above 5 per cent at Sh53 billion. We will import basic commodities as usual, and watch thousands of our able-bodied men; women and children starve and then plead with donors to help. Nothing much will change here. Poor, jobless and hungry folks in the country are a more serious security issue than Al Shabaab in Somalia.
The macroeconomic indicators don’t look pretty either. Our GPD growth prospects are less rosy than what the minister predicts. The high inflation, rising interest rates and depreciating shilling will not boost growth. Nonetheless, the minister must look good in an election year. And so the hard questions don’t get addressed.
Our exports remain very depressed, at 23 per cent of the GDP, or just over Sh500 billion. On the hand, the imports are double that, at over Sh1.3 trillion. It is hard to see how Prof Njuguna Ndungu will keep the shilling steady in such a situation. To worsen the situation, huge public spending will fuel inflation. Our expenditure as a percentage of the GDP is above 33 per cent when revenues are only 23 per cent.
Treasury might blame the new institutions and devolution for the huge spending plans but that may not be so. Counties will receive only 10 per cent of the expenditure. Even the roads will receive only Sh123 billion. Well, much of the spending will be the conspicuous consumption in the public service.
And in part, it is public policies that are lacking in priorities and necessity that swallow funds that may be put to better use. It is the reason the crucial FPE will receive only Sh8.3 billion, and our schools will continue learning with a shortfall of 50,000 teachers. Government will continue to do many mundane activities that private sector should have done or financed, whilst some critical flagships in Vision 2030 remain far behind schedule. Well, we toast to it, and forget it ever was a short while later."
The writer is a former MP for Mandera Central and political economist. Courtesy of Standard Digital
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