Kenya has made significant progress in budget transparency thanks to sustained institutional and policy interventions. This is despite the government coming under scrutiny in recent weeks over the widening budget deficits.
This is according to findings by the Open Budget Survey 2023 which shows that Kenya improved in transparency score from 50 in 2021 to 55 this year. This is way above the global average of 45.
Kenya is ranked 48 out of 125 countries when it comes to publishing information to support robust public debate on annual budget estimates.
Speaking during the launch, IPF CEO, James Muraguri noted that the fact that the government collects and spends billions of taxpayer funds to pay for public services, the public has a right to know how that money is allocated and how it is spent.
“Transparency and participation in the budget process are consistently associated with improvements in the quality of the budget, such as a lower deficit, more targeted budget priorities, and increased operational efficiency. These values can also lead to better governance and redirection of spending to marginalized communities,” Muraguri said.
He says by engaging citizens at all stages of budget-making, there will be improved public trust in government, increased civic participation and political know-how, increased tax revenue, and lead to better development outcomes.
“Participatory budgets have been shown to have the potential to build tax morale and increase revenue. This is because budget transparency creates a virtuous cycle in public debt management, leading to lower borrowing costs as well as low debt levels,” Muraguri said.
The report comes at a time when there are ongoing budget public hearing sessions spearheaded by the National Assembly Finance and National Planning Committee to give views on the proposed Kshs 3.914 trillion 2024/2025 budget.
The estimated revenues from taxes are expected to be Kshs 3.354 trillion, made up of ordinary revenues of Kshs 2.913 trillion and appropriations-in-aid of Kshs 441 billion. Further, the projected fiscal deficit will be Kshs 703.9 billion which is the difference between total revenues and grants and total expenditure and net lending. This fiscal deficit represents 3.9% of Gross Domestic Product (GDP).