Election budget overspent by Sh4 billion, Treasury says

National Treasury Cabinet Secretary Henry Rotich at a past function. A report by Treasury has revealed that the expenditure on the General Election and related activities was Sh4.05 billion above the approved budget. PHOTO/FILE 

In Summary

• The total actual expenditure for IEBC in the 2012/2013 financial year is Sh30.931 billion
• The Post-election Economic and Fiscal Report prepared by the National Treasury attributed the expenditure to increased expenses by IEBC
• Sh204 million was spent on swearing-in of President Kenyatta and his deputy William Ruto

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By JOHN NGIRACHU
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Expenditure on the General Election and related activities was Sh4.05 billion above the approved budget.

The Post-election Economic and Fiscal Report prepared by the National Treasury attributed the expenditure to increased legal fees for the Independent Electoral and Boundaries Commission, transportation, training, by-elections, simulation and publicity among others.

The total actual expenditure for IEBC in the 2012/2013 financial year is Sh30.931 billion, Treasury says in the document prepared by Cabinet Secretary Henry Rotich and Principal Secretary Dr Kamau Thugge.

Produced under pressure by the Budget and Appropriations Committee, the post-election economic update ought to have been published “not later than four months after the polling day of the General Election” as per the Public Finance Management Act.

The committee demanded the report from the Treasury after realising that it was not forthcoming long after July 4. MPs are not required to debate and adopt it.

According to the report, the IEBC spent Sh754 million on legal fees on the boundaries delimitation cases and General Election petitions, Sh249 million as a “cost of compliance”, Sh393 million on security for polling and tallying centres and Sh820 million on transportation.

Other costs were training and sets (Sh876 million), by-elections (Sh189 million), simulation (Sh131 million), materials (Sh164 million) and publicity and awareness (Sh469 million).

In addition to the IEBC’s costs on security, the Provincial Administration and Internal Security ministry is reported to have spent Sh800 million on “security operation and transport costs.”

The Immigration and Registration of Persons “has spent the entire Sh156 million it was issued to fast track issuance of identity cards and related documents for the purposes of registration and voting.”

The Treasury has also for the first time revealed the cost of the swearing-in of President Kenyatta and his deputy William Ruto, putting the figure at Sh204 million.

A detailed account is not given but the budget for that was initially Sh178.9 million. The Sports Stadia Management Board is yet to be paid Sh25.2 million for the hire of the Moi International Sports Centre at Kasarani.

SWEARING-IN BUDGET

These expenses were the subject of controversy on September 1 after the Sunday Nation revealed that the Assumption of the Office of the President team had initially budgeted for Sh1.2 billion.

Then Treasury PS had reduced this to Sh279 million, meaning the team spent considerably less than they had initially projected.

Treasury says, “Only Sh147.8 million was released from the exchequer and spent hence Sh31 million is owed to the Internal Security Ministry for security equipment and expenses of county delegates.”

On the economic front, Treasury says that data for the first three months of the year shows that the economy grew by 5.2 per cent. It grew by 3.9 per cent over the same period last year.

“This was the highest first quarter performance registered over the last three years,” the report says. “Agriculture sector registered a high growth of 8.3 per cent in the quarter due to the improved weather conditions.”

Inflation increased to 4.9 per cent in June from 4.1 per cent in May, says Treasury, because of a rise in food inflation to 6.5 per cent from 4.3 per cent. This is because of an increase in the price of goods.

The report says activities in the construction sector were robust and grew at 13.5 per cent compared to 3.1 per cent in 2012. “The growth was also reflected in the production and consumption of cement which grew by 7.5 per cent and 14.1 per cent respectively over the same period,” the report states.

Hotels and restaurant investors were the unhappy lot despite the good news economy-wise as the report states that their sector was the worst performing because of the negative effects associated with the uncertainties over the elections.

The sector’s growth reduced by 15.8 per cent during the three months compared to a 3.2 per cent growth in the same period in 2012
.

“The slowdown in the sector was mirrored in visitor arrivals and lower occupancy rate in the hotel industry. Hotel beds occupied in Nairobi high class and coastal beach declined by 8.2 per cent and 23 per cent respectively in the first quarter of 2013 compared to the first quarter of 2012,” the report states.