Senators inch closer to raising debt ceiling

Murang'a Senator Irungu Kang'ata attends a court session on August 29, 2019. He managed to convince his colleagues to adopt the Public Finance Management regulations during a meeting at Nairobi County Hall on November 4, 2019.

It was a close contest Monday as two committees of the Senate voted to recommend that Kenya’s debt ceiling be increased to Sh9 trillion after adopting a proposal by the National Treasury to amend the Public Finance Management regulations.

The decision by the joint sitting of the Delegated Legislation and Finance and Budget Committees comes after the National Assembly approved the PFM regulations on October 9.

As of June, the public debt stood at Sh5.81 trillion, equivalent to 61.8 per cent of the gross domestic product (GDP), which is higher than the 50 per cent threshold in the PFM regulations.

The onus is now on the Senate plenary to agree with the recommendations or reject them.

A rejection of the proposal will mean that the status quo will prevail, a move that will hurt a government that plans to borrow Sh640 billion this year to plug the hole in the budget.

Regardless of their political affiliations, eight senators voted to approve the proposal while seven opposed during a stormy meeting held at County Hall.


According to sources in the joint sitting, those who supported the proposal were West Pokot Senator Samuel Poghisio, who chairs the Delegated Legislation Committee, Irungu Kang’ata (Murang’a), Mohamed Mohamud (Mandera), who chairs the Finance and Budget Committee, and Dr Abdullahi Ibrahim (Wajir).

The others were nominated senators Isaac Mwaura (Kiambu), Rose Nyamunga (Kisumu), Judy Pareno and Farhiya Ali Haji (Wajir).

The opposers included Moses Wetang’ula (Bungoma), Mutula Kilonzo Jnr (Makueni), Aaron Cheruiyot (Kericho), Okong’o Omogeni (Nyamira), Boniface Kabaka (Machakos), Victor Prengei (nominated) and Millicent Omanga (nominated).

Sources at the meeting said Senator Kang’ata, who is also the deputy majority whip, was the one whipping his colleagues for the adoption of the regulations, arguing that the government’s key infrastructure projects will stall if the contrary were to happen.

“As Kang’ata pushed for the regulations, he told the committee that the government needs to undertake austerity measures as a sign of goodwill and willingness to cut down on wastages,” the source said.


However, when reached for comment, Mr Kang’ata told Nation to wait until the report of the joint committees is made public.

Those who opposed the proposal argued that passing the regulations would breach East Africa Community commitments.

Kenya is a signatory to the EAC Monetary Union Protocol that provides that in the convergence criteria, member countries will endeavour to achieve a public debt ceiling of 50 per cent of the GDP in Net Present Value (NPV) terms by 2021.

The Institute of Certified Public Accountants of Kenya (ICPAK) and civil society groups say that the move will be akin to mortgaging the country due to the high debt burden.