President William Ruto has slashed Kenyas 2024/2025 budget by KES 177 billion 1.3 billion weeks after protesters pushed back against a plan to raise taxes . Many Kenyans say that while the government has highlighted the importance of citizens making sacrifices, the cost of governance remains high.
Todays decision to reduce the 2024/2025 budget to KES 3.67 billion 28.7 billion is part of a series of compromises by the government as calls for President Rutos resignation continued to grow this week.
Over the last few days, our treasury team has been assessing the adverse impact of either reducing the budget by KES 346 billion in full or borrowing the KES 346 billion in full, Ruto said in a televised address on Friday.
Cutting the entire amount, in our assessment, would significantly and drastically affect the delivery of critical government services while borrowing the whole amount in full will occasion a fiscal deficit by a margin that will have significant repercussions on many sectors, including our exchange rate and interest rates.
Ruto said the government will take loans to protect funding for several critical areas, including hiring junior secondary teachers and medical interns, funding the milk stabilisation program for farmers, and retaining the fertiliser subsidy programme.
