What you need to know about 2024/25 Budget process ahead of today's reading

For the majority, they anticipate the government to prioritise agriculture, debt management and address fiscal challenges to aid in easing the burden among the taxpayers. 

Others are hopeful that the Bottom Up Economic Transformation Agenda (BETA) will be realised through the latest budget as Kenyans have been disgruntled over the tough economic conditions despite Ruto's promise to lower the cost of living.

In what is considered an integral step in the government, some critics point out that the budget will be a make or break for Ruto's administration moving forward. 

The government is expected to incur a total expenditure of an estimated Ksh.3.9 trillion, an increase of Ksh.200 billion from the previous budget. 

Hence, before Treasury Cabinet Secretary Njuguna Ndung'u appears before Parliament to read the budget, it is important to factor in the process that leads to the formulation and preparation of the document. 

Budget Process

The process is guided by the budget calendar which lists the timelines for key activities to be undertaken. The first step for the Treasury CS involves developing the Medium Term Expenditure Framework (MTEF) guidelines. 

The framework is a three-year outlook of government revenue and expenditure to make informed policy decisions. The process is guided by the Public Finance Management Act (PFMA).

Sector Working Groups will then be formed to help in coordinating and prioritising the major policies within the budget estimates.

These proposals will then be included in the Budget Review and Outlook Paper (BROP) which is submitted to the Cabinet for approval by 30th September every financial year. 

The BROP includes statements on the fiscal performance of the past year in comparison with this year, actual financial performance for the previous financial year and how external factors such as economic, demographic, technological, and natural, will influence the economy.

All the proposals and estimates are set out in the Budget Policy Statement which is presented before the National Assembly. Further, the CS also presents other documents including the MTEF Budget statement, draft Budget estimates and Finance Bill to parliament for approval. 

At least two months before the end of a financial year, the Treasury CS will table before the National Assembly the estimates of the revenue and expenditure of the national government.

Once the estimates have been approved, they are included in an Appropriation Bill which grants the government access to withdraw funds from the Consolidated Fund to meet expenditure needs. 

The Appropriation bill and any other law required to implement the budget are passed before the end of the financial year.  

All budget estimates are included in a final budget statement publicised by the Treasury in June and read by the Cabinet Secretary in Parliament.