Domestic revenue collected by the Kenya Revenue Authority (KRA) at the end of the fourth quarter of 2013/14 was KES 899.3 billion, 0.2% short of annual target but up by 18.4% compared to 2012/13 period. Owing to an upsurge in total borrowing, overall revenue receipts by Treasury including donor aid surpassed the annual target by 1.3%. On expenditure, like in previous years, budget implementation remains a challenge. The government failed to spend 27% of its annual budget of KES 1,135 billion that was surrendered to Treasury.  The biggest challenge is the low uptake of development budget; only 52% of this budget was utilized by the end of the fourth quarter. Gravely affected were infrastructure related ministries and the National Treasury.

Slow disbursement especially of donor funds is seen as the problem. Only 51% of donor financed development budget was released by the end of the financial year To this end, IEA Kenya proposes the need for government to discount or scale down all projections of donor disbursements in subsequent financial years for more accurate budget planning. Secondly, we propose a raft of other measures including the need for government and donors to harmonize their procurement procedures; hold regular consultations and meetings and the need for off-budget donor funds to progressively be channeled through government budget systems as ways of improving efficiency in development spending. We also note the importance of proper cash flow planning anchored by Integrated Financial Management System (IFMIS) and adoption of Treasury Single Account in order to curb unnecessary borrowing charges during periods of temporary cash shortfall. Finally, for effective public input into the budget implementation process, the Office of the Controller of Budget should ensure that revenue information is presented in a more disaggregated manner.