[FULL VIDEO] Kenya Budget 2014/2015 Speech

Budget: Govt introduces e-procurement to cut wastage

The government has announced that procurement processes will be done electronically in order to reduce wastage on government spending.

Treasury Cabinet Secretary Henry Rotich announced this during the tabling of the national budget at the National Assembly on Thursday.

Mr Rotich said the move was one of the measures to ensure the government does not overspend citing it as a way of cutting expenditure and ensuring efficiency and value for money.

“All government procurement will be done electronically and the days of inflated prices will be a thing of the past. To entrench accountability, a new Procurement law will shortly be submitted to this House,” he added.

Among other measures that will be taken to trim government spending include expenditure tracking and value for money audits to ensure accountability and efficiency and effectiveness in the use of public resources at both levels of Governments.

“As part of efforts to combat waste, the budget allocations for consultancy services, travel and hospitality have been curtailed, which will contribute to savings going forward,” said Mr Rotich.

Mr Rotich noted that there was need to reform VAT, income and excise tax in order to improve tax collection.

“We will strengthen revenue collection effort by bringing into the tax net all potential taxpayers. This entails implementing reforms to enhance revenue administration capacity; simplifying and modernising tax legislations; and leveraging ICT to enhance tax compliance,” he said.

He added that a new CBK Bill, Financial Services Bill and other financial sector regulatory bills were set to come to the house this year.


Mr Rotich said the budget was driven by the concerns raised by Kenyans regarding insecurity, unemployment and the economy.

To the security docket, the CS proposed to allocate Ksh 66.2 billion for policing services, Ksh 71.3 billion for Kenya Defence Forces and Ksh 17.4 billion for the National Intelligence Service.

“Among the key interventions under the security are; Sh.6.7 billion for leasing of 2,700 motor vehicles and aircrafts for security to enhance ground and aerial crime patrol and response; Sh.3.3 billion for enhanced security operations; Sh.2.9 billion for recruitment and training of additional 10,000 National Police Officers; Sh.3.5 billion for security equipment upgrade and modernisation,” he stated.

There was, however, no immediate rise in the cost of basic goods in the 2014/2015 budget.

The CS however increased import duty on imported iron and steel products that he noted were creating unfair competition for the local steel mills forcing the industries to close down.

“I have increased duty rates on a wide range of iron and steel products, which are available locally, from 0 per cent and 10 per cent to 25 per cent, in order to cushion our local industries from cheap imports. These measures will raise additional Sh 2.6 billion to the exchequer,” he added.

The government will further support the generation of affordable and adequate clean and safe energy for industrial development.

“To support wider use of solar energy, I have removed import duty on machinery, spares and inputs for direct and exclusive use in the development and generation of Solar and Wind energy,” said Mr Rotich.

A measure to cushion tourism was introduced where employers will get tax deductions in order to facilitate holidays for their employees for one year.

“Through this measure, we are directly giving at least 300,000 additional Kenyan guests a chance to go for a week’s vacation in our hotels throughout the country at the expense of their employers. This measure will be effective for 12 months, effective tonight,” said Mr Rotich.

He however noted that the measure will result to a revenue loss to the exchequer of Sh2.4 billion.

To support the private sector the Cabinet Secretary said the government will invest in an electronic system to help small medium enterprises apply, pay and acquire licences online.

“We are committed to making it easier for all small scale businesses to; start business, acquire trade permits, register property, access credit, file and pay taxes and trade across counties and countries so as to position them as creators of new jobs and new products,” he added




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