The Exchequer has sanctioned many austerity measures to fill the budget deficit following President William Ruto's withdrawal of the Finance Bill 2024.
Through the tax measures in the condemned bill, the government would raise an additional Sh345 billion.
But Ruto would not sign the bill into law following pressure from the public characterised by nationwide mass action protests.
In light of this reality, the National Treasury announced measures to cut spending to free up monies to other critical government functions.
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Cabinet Secretary Njuguna Ndung'u addressed a circular to principal secretaries and accounting officers in Ministries stipulating cuts and the complete scrapping of various expenditures in Ministries, Departments and Agencies (MDAs) and Semi-Autonomous Government Agencies (SAGAs).
"The government will control expenditures by initiating austerity measures on the provisions for the operations and maintenance. These measures will be undertaken in all MDAs, including SAGAS in the expenditure areas," partly read The National Treasury's circular.
Going forward, public servants will not be entitled to housing and car loans.
Further, the Exchequer annulled the spending on refurbishment of buildings, purchase of vehicles and other transport equipment, purchase of household furniture and industrial equipment and purchase of generators.
Ealier, the president announced the dissolution of 47 state corporations in a move to cut government spending.
Ruto said the functions of the state agencies will now be integrated into their respective ministries.
“Forty-seven state corporations with overlapping and duplicating functions will be dissolved resulting in the elimination of their operation and maintenance costs and their functions will be integrated into their respective ministries,” he stated.
The Head of State noted that staff from the affected 47 corporations will be transferred to other ministers and state agencies within the government.
At the same time, the president mentioned that he had suspended the decisions to fill the positions of chief administrative secretaries in government.
Ruto also disclosed that the number of advisors in the Kenya Kwanza government will be reduced by 50 percent.
Further, President Ruto announced that the budget allocations providing for the operations of the office of the First Lady, the spouse of the Deputy President and the prime Cabinet Secretary will be removed.
Similarly, the budget allocation for confidential budgets in various executive offices has been removed, and the budget for renovations across the government has been reduced by 50%.
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