David Ndii, the Chairperson of President William Ruto’s Council of Economic Advisers, on Monday, April 10 gave an interview on Citizen TV addressing the government’s current fiscal quagmire. The government is under pressure as civil servants with the exception of teachers and members of disciplined forces are yet to receive their March salaries.
Government agencies including the Kenya Broadcasting Corporation (KBC) and the Independent Electoral and Boundaries Commission (IEBC) are among those yet to pay employees, with lawmakers and pensioners from the civil service also yet to receive their dues. In addition, the 47 counties are yet to receive their revenue allocations from the national government, a situation that threatens to bring their operations to a halt. Governors say the National Treasury has yet to release funds for the past four months.
Ndii stated that the civil servants payroll would be settled ‘next week’, but admitted that the government was facing a liquidity crisis driven by mounting debt repayments. He, however, admitted that the government was wasteful and advised on measures to be taken to stem the situation.
“Government is extremely wasteful, there is not a single day that I am not exasperated by not just how wasteful it is but by how deliberate it is and how unbothered people are,” he asserted.
Ndii stated that institutions including the office of the auditor-general and investigative agencies were unable to curb the wastage in government. Offering solutions, he suggested that automation of procurement processes and strengthening of the Auditor-General’s office could help buck the trend.
“We do need to put in systems that try and get more value for money. We probably could strengthen the Auditor-General’s office so it does a lot more value-for-money audits. Automation, there’s a lot of automation particularly around procurement that could help the government be more cost-effective. Automation of procurement, part of IFMIS, has been on the cards for something like ten years, for as long as I can remember. Somehow, it never happens,” he maintained.
He ruled out restructuring of debt, stating that the government was illiquid and not insolvent. He argued that going the restructuring route would take the country into lengthy negotiations for the next three to four years, offering parallels with situations in Ghana and Zambia.
“You restructure your debt when you’re insolvent. That means you couldn’t pay. We are not insolvent. Our debt is actually payable. We can finance our payments…It’s a very bad idea.”