Budget Implementation Review Report

Office of the Controller of Budget

dc.contributor.author	Office of the Controller of Budget
dc.date.accessioned	2021-09-10T06:53:29Z
dc.date.available	2021-09-10T06:53:29Z
dc.date.issued	2012-07
dc.identifier.uri	http://192.168.150.44/handle/123456789/553
dc.description	It gives me great pleasure to present the fourth Quarter Budget Implementation Review report for the period ending June 2012. This report gives a synopsis of the status of budget implementation and assesses the progress made towards the attainment of goals set in the 201ll20LZ Budget. It is prepared at a time when Kenya's economy is experiencing slowed growth. To counteract the effects of the slow growth, the govemment has put in place various fiscal and monetary policies to stimulate growth. Effective budget implementation will boost creation of jobs and also create confidence in our economy. Building that confidence requires prudent fiscal planning, implementation and credible polices. To support sustainable job creation and healthy public financial management, the 2011/12 Budget puts emphasis on the main drivers of the economy such as agriculture, tourism and manufacturing. High on the agenda in the Office of the Controller of Budget (OCoB) is improving budget implementation and ensuring approvals and withdrawals from public funds are done within the law In an effort to ensure that this happens, the OCoB has been working towards putting in place various initiatives to help Ministries, Departments, and Agencies (MDAs) improve on budget implementation. First, the office is in the process of putting in place a Monitoring and Evaluation framework to ensure that MDAs' programmes and projects are continuously monitored and evaluated. This will ensure that the citizens realize value for money. Secondly, the Office is in the process of developing procedures manuals for withdrawal of funds to ensure timely approval of withdrawals from public funds for both national and county govemments. Thirdly, the OCoB with other stakeholders are in the process of developing legal and regulatory framework, which will provide guidelines for budget implementation. Finally, the OCoB will continue to advise MDAs on prudent use of public funds to ensure they spend their funds within their budget ceilings and the law. The Office of the Controller of Budget, through this report, is working towards ensuring that fiscal reporting is clear and that there is openness and accountability, including public participation in financial matters as articulated in the Constitution. I therefore hope that the contents of this report will be useful to all our stakeholders as we all endeavour to cultivate budget transparency and accountability that will ensure delivery on set targets in line with government policies and Vision 2030. I have the honour of presenting the fourth quarter Budget Implementation Review Report to Parliament and all stakeholders.	en_US
dc.description.abstract	This is the fourth quarter report on budget implementation by the Office of Controller of Budget for the financial year 20llllZ.The OCoB, under the Constitution 2010 (Article 228(4)), is mandated to oversee the implementation of the budgets both at the national and county govemments. The 2012 financial year Budget focuses on enhancing the efficiency of Government expenditure in view of critical resource limitations and ensuring macroeconomic stability. One approach adopted in the budgeting process is the linking of key projects and programmes in the budget to Kenya's Vision 2030 through the Medium Term Plan (2008-2012) and the Millennium Development Goals. The Economic Survey (2012) shows that the GDP grew by 4.4 per cent in 2011 which was below the projected growth of 5.7 per cent as per the 20llll2 Budget Policy Statement (BPS) released in March 2011. The main sectors that contributed to growth were; Agriculture, Manufacturing Wholesale and Retail Trade, Financial Intermediation among others. The economic growth was adversely affected by drought that affected most parts of the country. The drought, compounded by volatility in the exchange rate significantly contributed to the increase in petroleum prices and a general unfavorable macroeconomic environment in the country. This relatively low economic growth had adverse effects on revenue inflows and budget implementation in some sectors. The drought and unstable shilling led to high inflation rates that hit an all time high of 19.7 per cent in November 2011. This has steadily reduced to 12.2 per cent and 10.05 per cent in the month of May and June respectively. This is however higher than 9 per cent that was targeted by the BPS in the short-term and 5 per cent in the medium-term. To counter the inflation and stabilize the Kenyan shilling, the Central Bank of Kenya increased the base-lending rate from 6.25 per cent in May 20ll to 18.0 per cent in December 2011, which was maintained till Jwre20l2. The printed estimates for revenue for the fiscal year 20lll20l2 was Kshs. 789.5 billion (24.7 per cent of GDP) comprising Kshs. 713.6 billion of ordinary revenue and Kshs. 75.9 billion of Appropriations in Aid (AIA). Cumulatively, ordinary revenue collected by Kenya Revenue Authority (KRA) for the period July 2011 to June 2012 stood at Kshs.707.4 billion against atarget of Kshs. 733.3 billion. This represents a revenue deficit of Kshs. 25.9 billion or a performance rate of 96.5 per cent. The cumulative collection of Kshs. 707 .4 billion represents a performance rate of 98.7 per cent of the revised revenue estimates of Kshs.7l6.9 billion. This is an improvement compared to the same period in FY20l0/11 when Kshs.634.9 billion was collected which represents 11.4 per cent growth. The total revised budget for the financial year 201112012 was Kshs. 1,170.5 billion comprising revised gross estimates of Kshs. 578.4 billion for recurrent, Kshs. 382.6 billion for development and Kshs. 209.5 billion for Consolidated Fund Services. This represents a one per cent increase over the printed estimates. The actual recurrent expenditure for the period under review stood at Kshs. 684.7 billion which represents 86.9 per cent of the revised gross estimates. The National Security sector had the highest rate of absorption of 100 per cent, while Physical Infrastructure sector had the least utilisation rate of 31.5 per cent of the gross revised estimates. The total development expenditure stood at Kshs. 210.7 billion which is 55.1 per cent of the gross revised estimates. The Trade, Tourism and Industry (TTD sector had the highest rate of absorption at 90.8 per cent while Special Programmes had the lowest absorption rate of 46.1 per cent of the gross revised estimates. In order to achieve the targets set in the Budget Policy Statement the government should develop clear and comprehensive guidelines for utilizing development funds efficiently by the MDAs that will ensure proper execution of projects and programmes to transform Kenya into a middle income economy as envisaged in the Vision 2030 Development Blueprint.	en_US
dc.description.sponsorship	Mrs.Agnes N. Odhiambo	en_US
dc.language.iso	en_US	en_US
dc.subject	Controller of Budget	en_US
dc.subject	Budget Implementation	en_US
dc.subject	Mrs.Agnes N. Odhiambo	en_US
dc.title	Budget Implementation Review Report	en_US
dc.title.alternative	Fourth Quarter 2011/2012	en_US
dc.type	Technical Report	en_US