Treasury saves Sh65 billion in budget cuts

Most ministries lose extra money for state to fund key projects

In Summary

•SRC's budget gets reviewed upwards with a Sh54 million funding increase. 

•The cuts follow a call by the President for budget rationalisation and reduced donor commitments. 


The National Treasury has slashed its budget by Sh35 billion in austerity measures that will see the government save Sh65 billion.

A number of ministries, according to the supplementary budget estimates tabled in the National Assembly last Thursday, have been affected by the cuts.

The slash in funds allocated to the sectors follows calls by President Uhuru Kenyatta for budget rationalisation to fund key state projects and reduced donor commitments.


Of the amounts Treasury set free, Sh25 billion was slashed on account of redistribution of salary adjustments after the job evaluation undertaken by the Salaries and Remuneration Commission.

The Department of Planning had its budget slashed by Sh808 million, having shed off Sh500 million to Parliament with the rest on account of budget rationalisation.

The Ministry of Water's budget was cut by Sh11 billion. Funds meant for water resources management was slashed by Sh1.8 billion on account of scaled-down donor commitment.

“Some Sh995 million was transferred to the State Department of Irrigation,” the budget estimates says.

Budget meant for water and sewerage infrastructure has been reduced by Sh6.6 billion after donor commitment was scaled down as the funds were not absorbed.

Treasury has also slashed the ministry’s cash meant for water storage and flood control by Sh3.4 billion on account of scaling down donor commitment.

The Health ministry suffered a budget cut of Sh3.7 billion for national referral hospitals and specialised services. Its allocations for general administration were cut by Sh2.1 billion over low absorption and another Sh1.02 billion for health policy, standards and regulations.


Regional and Northern Corridor agencies will also experience funding shortfalls of about Sh5.5 billion whereas the Attorney General’s office got an additional Sh300 million to handle the Somalia-Kenya maritime border dispute.

The Energy ministry also suffered a Sh2.4 billion funding cut caused by a reduction in allocations for power generation and alternative energy technologies.

Efforts to conserve Kenyan water towers also got a beating after the Environment and Forestry ministry lost Sh1.7 billion in the cuts.

Cash-strapped universities are heading for tougher times after their budgets were reduced by Sh1.7 billion in the last quarter of the financial year on account of budget rationalisation.

Roads and Public Works sectors also lost Sh759 million and Sh779 million respectively in the reviewed estimates. The funds were meant for works on government buildings, coastline infrastructure, and for industry regulation – largely affecting the National Construction Authority's budget.

Prisons were not spared the cuts having lost Sh1.2 billion, probably as a result of steps being taken by the Judiciary to have petty offenders spared jail terms.

Other losers were Lands ministry which will lose Sh655 million budgeted for Land Policy and Planning. “The reduction is on account of lower absorption,” Treasury said.

E-Government Services also took a hit with a Sh375 million funding cut despite the parent ministry getting increased allocations for rent arrears and salary shortfalls.

The Fisheries Department will now operate with Sh548 million less. The cash was meant for fisheries development (Sh261 million), and coordination of the Blue Economy (Sh287 million).

Despite cries for more funding, the Judiciary still had its budget reduced by Sh40 million. That of the office of the Registrar of Political Parties was slashed by Sh25 million.  

The IEBC lost Sh130 million on account of delayed activities for delimitation of boundaries whereas the National Assembly will make do without Sh261 million it had been allocated for oversight.

In as much as departments took cuts, a number of departments had their budgets adjusted upwards such as the SRC which got Sh54 million for operations and maintenance.

(Edited by R.Wamochie)