Members of Parliament have acted to raise the national debt ceiling to Sh10 trillion as proposed by Treasury Cabinet Secretary Ukur Yatani. The matter has now been forwarded to the Senate for concurrence.
MPs approve rise of debt ceiling, motion moved over to Senate
The regulations set to be reviewed by the Senate were enacted in 2019
The current debt ceiling is Sh9 trillion, however a gazette notice dated May 26 indicated Treasury had plans to amend the Public Finance Management (PFM) (National Government) Regulations of 2015.
“Regulation 26 of the PFM (national government), 2015, is amended by substituting it with the provision that the public debt shall not exceed Sh10 trillion,” the gazette notice reads in part.
Raising the debt ceiling will give the Government allowance to borrow more during the 2022/23 financial year. In April this year, CS Yatani unveiled a sh3.3 trillion budget for the fiscal year aimed at reviving the economy.
Adjourning of Parliament
The decision by the National Assembly comes at a time when the MPs are set to adjourn on Thursday, June 9 with no appointed date for resumption ahead of the much anticipated August 9 General Elections.
However, the increase of the debt ceiling will not happen until both Houses must conduct the necessary approval procedures such as conducting public participation on the proposed amendments.
“Provided that if at any time the public debt exceeds the limit and the regulations, the Cabinet Secretary shall provide parliament with a written explanation and provide a time-bound remedial plan,” the PFM (Amendment) Bill 2020 reads in part.
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