Health, jobs and homes to soak up tax billions

National Treasury Cabinet Secretary Henry Rotich delivers his speech during the launch of Economic Survey Report at KICC, Nairobi, on April 25, 2018. The Treasury indicates that it will reconfigure the National Health Insurance Fund. PHOTO | DIANA NGILA | NATION MEDIA GROUP 

In Summary

• Those living in the marginalised areas will also have to wait longer to benefit from the Equalisation Fund.
• Public health institutions will get Sh3.4 billion through the National Hospital Insurance Fund for maternity services.
• The government plans to provide 500,000 affordable housing units by 2022 and create 350,000 jobs.

By PATRICK LANG'AT
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Families displaced by floods that have killed some of their relatives over the past one month wish
they could benefit sooner from a government spending plan presented in the National Assembly last month, but the Sh60.4 billion earmarked for floods control and rain water harvesting will be released in July, long after their suffering.

Those living in the marginalised areas will also have to wait longer to benefit from the Equalisation Fund, for which Sh4.7 billion has been approved, because the Commission on Revenue Allocation is yet to complete a policy on who should benefit, and how.

Schoolgirls who need sanitary towels now have a Sh470 million fund, despite the Treasury admitting to Parliament that the pads might not get to most of the girls because of capacity challenges.

These are some of the expenditure plans presented to the National Assembly by Majority Leader Aden Duale for the next financial year, which prop up President Uhuru Kenyatta’s ‘Big Four’ projects with Sh460 billion funding.

'BIG FOUR' PLAN
Public health institutions will get Sh3.4 billion through the National Hospital Insurance Fund for maternity services, a move meant to ensure counties do not divert the money to other uses.

A further Sh52 billion is earmarked for disadvantaged groups, even as questions linger on whether the funds would be better disbursed through mobile phones rather than government agencies.

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The expenditure plan illustrates, in its numbers and projections, the tight balancing act the Treasury will have to carry out in the next 12 months.

It also seeks to cushion projects under the ‘Big Four’ agenda from underfunding, which the National Assembly Budget committee warned of in February.

Under the plan, President Kenyatta hopes to increase the manufacturing sector’s share of the Gross Domestic Product to 15 per cent by 2022, enhance food security, provide universal healthcare to all Kenyans, and build at least 500,000 affordable new houses by 2022.

ALLOCATION
In the estimates, however, the Treasury fails to state which of the Sh460 billion will go to state agencies, and how much, or whether funds allocated to government departments involved in the ‘Big Four’ will all go towards President Kenyatta’s grand plan.

In all, the Health ministry has been allocated Sh90 billion against Sh54 billion in the current financial year, the Housing Department Sh32.23 (Sh15.7 billion), the Irrigation Department Sh17.97 billion (Sh15.7 billion), and Industry Sh10.3 billion (Sh7.3 billion).

The government also plans to spend Sh43.1 billion to improve food security.

The Departments of Livestock, Crop Development, and Fisheries and Aquaculture — all working towards the bigger picture of a food-secure nation — have been allocated Sh6.2 billion, Sh25.5 billion, and Sh2.7 billion, respectively.

Agricultural research will be funded to the tune of Sh5.5 billion.

FOOD SECURITY
The Treasury’s Budget Policy Statement, which lays out the projects the government hopes to carry out when it asks the House to pass the Budget, proposes the production of 2.76 million bags of maize, potato, rice and feeds on 52,000 acres of land by the end of this year, with an additional 70,000 acres targeted under public-private partnerships for the listed crops, plus cotton and aquaculture.

It also aims to reduce post-harvest losses from 20 to 15 per cent and waive incentives on cereal drying equipment, silos, fishing and aquaculture feeds.

It also plans to put up two potato seed stores in Nyandarua and Molo, one potato ware store in Nyandarua, three fish stores in Migori, and to rehabilitate three fish landing sites in Migori, Homa Bay, and Busia.

From the Sh90 billion budget for the Health ministry, the Treasury proposes to spend Sh44.6 billion on universal health coverage.

This figure, however, includes donor funds, whose volumes are not indicated.

HOUSING
The Treasury also indicates that it will reconfigure the National Health Insurance Fund and reform the governance of private insurers, culminating in an increase of NHIF’s enrolment from 16.5 million to 25.74 million.

To do this, the government will use 37,000 banking sector agents, four banks, three mobile phone companies and 100,000 community health workers to recruit 20 households each.

In its plan to provide 500,000 affordable housing units by 2022 and create 350,000 jobs while raising the contribution of the real estate sector to 14 per cent of GDP, the government proposes Sh6.5 billion in the ‘Big Four’ agenda line, but with state agencies in the sector also getting money to make investments in the area.

READ: Experts' views on government plan to provide housing

BUSINESS

The Department of Housing, Urban Development and Public Works has been allocated Sh32 billion, with Sh8 billion going to housing development and human settlement.

The Department of Industry has been allocated Sh10.3 billion, with Sh2.7 billion going to the Department of Small and Medium Enterprises.

In the leather sector, President Kenyatta targets the making of 20 million shoes by 2022, while increasing export revenue in the industry to Sh50 billion in the next five years.