| Post date: Thu, Mar 22, 2018 | | Category: Budget | |
Auditor General’s report 2015/16, shows that the approved budget for the Ministry of Health, at the national level, totaled to Ksh 60 billion for the financial year ending June 2016. This budget is composed of Ksh 31 billion development budget and Ksh 29 billion recurrent budget. The proportion of the budget that is planned for development, (52%) is substantial and meets the fiscal threshold of 30%. This week’s number seeks to find out how much of the budgeted expenditure was actually expended in 2015/16. A comparison of the absorption rates between recurrent and development is done to establish any existing differences.
Budget performance for Ministry of Health, 2015/1
Source: Auditor general report, 2015/16
The chart above illustrates both approved budgets for recurrent and development for 2015/16 and compares these with the actual expenditure realized at the end of year. It reveals that for both types of expenditure, recurrent and development, the actual expenditure is lower than the budget implying low utilization rates in the ministry of health for that particular year.
Number of the Week: 53%
In conclusion, the low absorption rates especially on development (53%) imply that even though development component of the health budget was more than the recurrent, the actual burn rate is just about half of the intended expenditure. In practical terms, could mean that some of the development projects that were planned for that financial year were not implemented.
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Treasury bonds are a secure, medium- to long-term investment tools that typically offer periodic interest payments semiannually throughout the bond’s life. The Central Bank auctions Treasury bonds on a monthly basis, but offers a variety of bonds throughout the year, so prospective investors should regularly check for upcoming auctions. Outstanding Treasury Bonds increased by 11.2 per cent to Ksh 1,152,041 million in June 2016 from Ksh 1,035,662 million in June 2015.
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The medium term debt strategy for the financial year 2016/17 emphasized on the need to develop the domestic market by increasing the issuance of Treasury bonds over the medium term. The strategy targeted a mix of 60 percent and 40 per cent for external and domestic financing, respectively.