Ndindi Nyoro Criticizes Treasury for Missing Revenue and Rising Debt

Ndindi Nyoro, a bold voice in Kenya's parliament, has openly criticized the National Treasury for its ongoing failures in meeting revenue targets and its approach to handling the nation's finances. As Chairperson of the National Assembly Budget Committee, Nyoro laid out some hard truths during the Budget Appropriations hearing held in November 2024. His concerns centered around far more than just missed targets; they delved into the roots of what he calls 'reckless borrowing' by the Treasury, which has been a significant factor in Kenya’s mounting debt crisis.

According to Nyoro, the past decade paints a worrying picture, with ordinary revenue collection achieving a mere 67% of set targets. This trend has led to persistent budget shortfalls. For instance, in the fiscal year 2023/24, the government aimed to collect Ksh2.46 trillion but only managed to rake in Ksh2.29 trillion. This Ksh172.1 billion deficit has raised eyebrows, especially when the country's public debt has ballooned to Ksh10.6 trillion as of July 2024. Such a huge debt burden leads to a significant portion of the budget going toward interest payments instead of being funneled into essential areas like infrastructure and social services.

Nyoro challenged the overly optimistic revenue targets set by the Treasury, considering the historical performance that shows a consistent lack of achievement. He argued that without a realistic and strategic approach, these targets would continue to miss the mark, creating further economic strain. The Treasury on its part acknowledged these shortfalls but seemed to remain hopeful. Treasury Principal Secretary Chris Kiptoo noted that recent monthly revenue setbacks were recorded, including Ksh35 billion in July, Ksh25 billion in August, and Ksh10 billion in September.

In response to the criticism and eyeing a better fiscal future, Kiptoo shared plans for tighter financial controls within state agencies. These measures aim to ensure money is spent judiciously, requiring agencies to justify their expenses comprehensively before receiving any funding. Additionally, even as they navigate these challenges, the Treasury expressed confidence in future economic improvements, relying on factors like reduced inflation to align revenue expectations more closely with reality.

This situation underscores the delicate balancing act that Kenya's financial leaders must perform. They need to boost revenues to meet the nation’s economic demands while managing a mounting public debt that threatens long-term fiscal stability. As debates continue, all eyes will be on how they adapt their strategies to foster sustainable growth and fiscal responsibility.