How Kenyan Budget Is Prepared

How Kenyan Budget Is Prepared

The process of preparing budget in Kenya

Have you ever wondered how Kenyan budget is prepared? Well, today we are going to look at how the process is done.

  • Treasury through the Cabinet Secretary calls for budget change proposals from the all the stakeholders including KRA.

 

  • The petition for budget change proposals is received by the Commissioner General, who cascades the request to the respective Commissioners.

 

  • The Commissioners cascade the request to the KRA Policy Unit Technical Division to Guide and oversee the process in the respective departments.

 

  • The Policy Unit Technical Division, Deputy Commissioners call the Regional Heads, Station Managers and staff to forward their budget change proposals. Policy Unit Technical gives guidelines on how the process should be carried out and mode of giving feedback.

 

  • The Regional and Station Managers call for budget change proposal meetings at the regional/stations level. The proposals are forwarded to the policy Unit Technical Division using the format described.

 

  • The Policy Unit Technical Division for the relevant Departments compiles the budget change proposals and forward to the relevant Commissioner who then forwards to the Commissioner General.

 

  • The budget change proposals from the different departments including those from other stakeholders willing to forward their proposals through the Commissioner General are compiled into one document and forwarded to Treasury.
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  • The Financial Budget Change Committee is formed in Treasury to deliberate on the proposed budget changes emanating from all the stakeholders.

 

  • The committee is divided into sub budget committees to discuss specific budgets proposals touching on specific Acts.

 

  • KRA Policy Unit Technical staff from the revenue departments form part of the treasury budget change committee. Their role is to defend proposals of economic development and revenue value.

 

  • The sub committees deliberate on the proposals giving reasons for accepting or rejecting the proposals.

 

  • The sub committees reconvene to further discuss the proposals for adoption by the main committee.

 

  • A budget score card is developed showing the status of all the budget proposals and giving reasons for accepting or rejecting each proposal

 

  • The Finance Bill which is simply a schedule of the accepted budget proposals is table in parliament for further deliberation by the parliamentarians. Further amendments are done as the members of parliament may deem fit.

 

  • The Cabinet Secretary reads the budget around the second week of June every year and the Finance Bill is released to the public immediately after the budget day for implementation.
  • The policy unit technical undertakes sensitizations to all staff and key stakeholders to ensure understanding of the budge change proposals for effective implementation.
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  • Stakeholders also conduct budget change sensitization forums for their members to ensure they also understand the budget change proposals for implementation.

 

  • The Finance Bill is implemented as if it were law as supported by the provisional Orders Act.

 

  • KRA staff and the stakeholders are on the lookout for proposals which may have a negative impact on the public, revenue, and economic growth etc. Such are marked for further deliberation and amendment.

 

  • The public and other interested parties also react to the finance bill as soon as it is released citing clearly areas of concern and reasons why the proposals should not pass into law.
  • Treasury budget change committee reconvenes to deliberate on the views of the stakeholders, the public and other interested parties. Concerns considered positive and of economic value are adopted.

 

  • Proposals that draw much concern and negative reaction by the public and stakeholders demanding for change are reconsidered and some dropped with valid reasons.
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  • The Draft Finance Act is developed and tabled in parliament for further discussion. Proposals may be dropped and or amended at this point as well. After the members of parliament agree on the proposals to be passed, the draft is passed on to the President for His accent. Once the President gives His ascent, the Finance Act which is actually the law is released for implementation. The Finance Act is released on or before 30th September every year.

 

  • The Policy Unit Technical Division in the respective department ensure the relevant revenue Acts are updated to incorporate the changes in the Finance Act.

 

  • Finance Acts sensitization sessions are conducted for all staff and key stakeholders to ensure standard understanding and effective implementation.

 

  • Stakeholders also conduct Finance Act sensitization forums for their members.

 

  • The budget change process starts again immediately the Finance Act is released as the stakeholders and other interested parties begin to identify areas of concern requiring change during the next budget cycle which starts every February.

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