Nairobi – The National Treasury in Kenya has taken a firm stance on state corporations’ budgets for the upcoming fiscal year, directing them to resubmit their 2024-2025 recurrent expenditure plans. The new directive requires these budgets to be rationalized to not exceed 70 percent of the approved budget for the current fiscal year.

Treasury Cabinet Secretary Njuguna Ndung’u emphasized that all state corporations must resubmit their budgets through the Government Investments Management Information System (GIMIS) by April 2, 2024. This move is part of the Treasury’s efforts to enhance revenue generation and expenditure control within state corporations.

In addition to the budget rationalization, state corporations have been instructed not to fund operations or purchase capital items for Ministries, Departments, State Corporations, and Agencies (MDA). The Treasury has also prohibited the payment of individual or corporate club membership fees and annual subscriptions by state corporations.

Furthermore, CS Njuguna highlighted that board expenses, including sitting allowances, daily subsistence, and travel costs, should only be covered by the approved board expenses budget. Any expenses related to board activities should not be charged to other budget categories without proper authorization.

State corporations are also required to obtain written approval from the Treasury before implementing any new projects. Additionally, a recent directive issued by the government on March 18, 2024, instructed state corporations to halt the procurement, printing, and production of corporate wear such as T-shirts, shirts, and tracksuits.

These measures are part of the government’s fiscal consolidation efforts aimed at improving revenue generation, controlling expenditure, and ensuring adequate resources for essential government services. By enforcing stricter financial management practices, the Treasury aims to promote transparency and accountability within state corporations.