Projects spending jumps 100 percent in the first quarter

Development spending in the three months to September more than doubled compared to the same period a year earlier, pointing to increased public investments in infrastructure projects.

National Treasury data shows Sh48 billion was channelled into capital projects between July and September, a growth of 115.63 percent compared with Sh22.26 billion in the same period a year earlier.

During the quarter, some Sh230.58 billion was channelled into recurrent items such salaries, while Sh214.8 billion was spent on debt repayments in the period when total taxes stood at Sh372.34 billion.

President Uhuru Kenyatta had at the beginning of last financial year frozen implementation of new projects by ministries and other State organisations until the ones that had been started were completed.

The bulk of the cash, 97.58 percent, was issued in September as only Energy Department had been given Sh1.16 billion to spend on development projects in the first two months of the current fiscal year.

Increased spend on development projects such as roads, water, power plants, real estate and electricity transmission lines stimulates economic activities, helping create job opportunities and grow government revenue, largely taxes.

Treasury statistics in the monthly Statement of Actual Revenues and Net Exchequer Issues show the State departments of Transport and Energy posted the highest absorption rate of development funds in the five-month period through four key state departments of Infrastructure, Transport, Water and Sanitation and Energy. They received Sh40.53 billion, or 84.44 percent of the funds.

The four departments, which largely deal with enablers to President Uhuru Kenyatta’s Big Four agenda, make up Sh125.95 billion, or a third of the Sh422.30 billion development budget estimates for this year ending June 2020.

Infrastructure, which is responsible for implementation of key projects such as roads, gobbled up nearly half, or Sh23.08 billion, of development spend during the quarter.

It was followed by Transport, where railway development lies, with nearly Sh6.36 billion, while departments of Water and Energy spent Sh6.04 billion and Sh5.06 billion, respectively.