The government has reduced the total budget for this financial year by KSh132.46 billion from KSh3.981 trillion to KSh3.848 trillion.
This is a reduction of 3.3 percent.
The announcement was made when President William Ruto signed into law the Supplementary Appropriation Bill 2024 and the Revenue Allocation Bill 2024 at the State House in Nairobi on Monday.
The new bills will unlock resources that will stimulate economic performance and improve service delivery.
The 2024 Supplemental Supply Act now cuts KSh32.6 billion from various budget allocations. By justifying the expenditure, the law authorizes the expenditure of KSh102 billion from the Common Fund for the year ending June 30, 2024.
The education budget has been strengthened, with university education receiving KSh4.468 billion and secondary education receiving KSh1.112 billion.
Development spending has also been directed to priority areas and reduced by KSh75.29 billion, while KSh51.12 billion has been allocated for emergency needs.
The law also legitimizes the use of KSh23.67 billion under Article 223 of the Constitution, which allows for emergency funding and approval by Parliament later.
This expenditure includes emergency interventions such as KSh4.3 billion to the State Department of Arid and Semi-Arid Areas and Regional Development for humanitarian assistance to those affected by the floods.
In addition, KSh3 billion has been allocated to the Department of Internal Security for managing the El Nino disaster, and another KSh3 billion for the fertilizer subsidy program.
Following the floods that destroyed infrastructure, KSh1 billion has been allocated for emergency road repairs.
In addition, KSh11.4 billion has been allocated for the Kenya Revenue Authority to strengthen revenue collection efforts (KSh4 billion) and pay pending bills of KSh7.4 billion.
In addition, KSh2 billion has been allocated to handle medical insurance for the National Police Service.
The additional approved spending is designed to cover emergency interventions against damage caused by El Niño rains and other critical needs.
These include KSh5.3 billion for emergency assistance, KSh3.3 billion for security operations, and KSh1.1 billion for the absorption of surplus milk by the New KCC.
President Ruto said the funds will help the government fulfill its promise to dairy farmers by ensuring prompt monthly payments and increasing the price to KSh50 per litre.
Meanwhile, the Revenue Allocation Act 2024 has increased the county allocation by KSh14.69 billion from KSh385.4 billion this financial year to KSh400.1 billion in the year starting July 1.
President Ruto said: “We have not only met the constitutional requirement of 15 percent, but we have also increased it to 25 percent.”
This increase is expected to enhance service delivery by ensuring that county governments are adequately funded to carry out their duties as outlined in the Fourth Schedule of the Constitution.
The law also allocates 2.5 trillion shillings to the national government. It also implements Article 204 of the Constitution on the Equalization Fund, providing KSh7.8 billion, which is equal to 0.5 percent of the final audited accounts.
