Commerce

Senate approves Treasury proposal to raise debt ceiling to Ksh10T

Tuesday, June 21st, 2022 18:58 | By
27 Senators backed the bid while three opposed the move to expand the debt ceiling
Senate

The Senate has approved a proposal by the National Treasury to raise the debt ceiling from Ksh9 trillion to Ksh10 trillion.

27 Senators backed the bid while three opposed the move in the final sitting of the Senate before the August polls.

Speaking during the session, Siaya Senator James Orengo who doubles as the Minority Leader pleaded with the government to exercise discipline in expenditure, so that the borrowed amount does not end up in corruption.

"In our nation, the financial discipline has always been lacking. If we extend the debt ceiling we hope that there will be responsibility to make sure that although Kenya may be making some strides in the area of infrastructure... but if we do not manage it well we will not be able to become a free market economy which can guarantee prosperity to the rest of the country," Orengo said.

MPs approve new debt ceiling

The Members of Parliament (MPs) supported the motion on June 7, 2022, setting stage for increased borrowing by the government to meet its financial obligations.

The expansion of the debt ceiling is expected to accommodate the 2022/23 fiscal deficit estimated at Ksh846 billion.

However, according to the 2022 Budget Policy Statement (BPS), the new ceiling will be breached before June 2024 hence forcing the country to expand the debt ceiling further.

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