Revenue shortfall sparks National Treasury’s Sh18 billion supplementary budget push
Treasury Cabinet Secretary John Mbadi says the government collected Sh2.2 trillion against a target of Sh2.5 trillion, resulting in a revenue gap of Sh253 billion.
The National Treasury has moved to secure an additional Sh18.9 billion in a fresh supplementary budget, as a widening revenue shortfall puts critical government services at risk.
In documents tabled in the National Assembly on June 18, Treasury Cabinet Secretary John Mbadi revealed that the government has collected Sh2.2 trillion against a target of Sh2.5 trillion by April, resulting in a revenue gap of Sh253 billion, comprising a Sh195.3 billion shortfall in ordinary revenue and Sh57.7 billion in Appropriation in Aid (AIA).
More To Read
- MPs say no to cheap steel imports, back local industries
- MPs, senators strike deal, agree on Sh415 billion revenue allocation to counties
- State House, NIS among beneficiaries of Sh9.3 billion emergency funds
- How Gen-Z protests forced National Treasury to cut Sh52 billion from budget
- House team raises alarm over pension delays as arrears pile up to Sh86 billion
- National Treasury reverts to old law after court nullifies 2023 Privatisation Act
The government is expected to turn to further borrowing to bridge the gap.
CS Mbadi said the new request is driven by urgent demands that have emerged since the last supplementary budget was presented in March.
“Included in the Financial Year Supplementary Estimates No. III is additional expenditure to cater for salaries shortfall, security-related interventions, among other priorities,” he said.
He explained that the 2024–25 budget has faced major obstacles in revenue generation and growing financial pressure.
“The execution of the FY 2024–25 budget has faced challenges regarding resource-raising and emerging expenditure pressure,” Mbadi said.
The Treasury also spent Sh34 billion under Article 223 of the Constitution since March. Of this, Sh28.5 billion went to recurrent expenditure, while Sh5.5 billion was for development, and Sh23.2 billion has already been released.
Mbadi asked Parliament to approve spending adjustments that have exceeded the allowed 10 per cent budget variation.
“Due to adjustments in the FY 2024–2025 supplementary No. 2, some programmes have exceeded the 10 per cent threshold,” he said.
“The National Treasury is therefore requesting special approval of the expenditure adjustments, which are beyond the 10 per cent threshold in accordance with regulation 40 (9) of the Public Finance Management regulations 2015.”
Despite the pressures, the overall ministerial expenditure for 2024–25 has slightly decreased by 0.5 per cent from the original estimates.
Of the Sh18.9 billion sought, the Treasury itself is allocated Sh5.85 billion. The State Department for Social Protection and Senior Citizens will receive Sh12.5 billion, raising its total budget to Sh47.8 billion.
The Housing Department is set to receive an additional Sh7.787 billion from development partners, on top of its initial Sh74.7 billion. Water and Sanitation will get Sh3.1 billion in addition to its Sh30.2 billion allocation.
Other increases include Sh3 billion for the National Intelligence Service, Sh1 billion for Lands and Physical Planning, Sh2.2 billion for Information Communication, and Sh1.69 billion for Sports.
Mbadi emphasised that the supplementary budget is necessary to guarantee the delivery of essential services, particularly in health, education, and infrastructure development, as the country prepares for the 2025–26 financial year, where the revenue target is set at Sh3.3 trillion.
Top Stories Today
