President Ruto proposes budget cuts after deadly protests

Kenyan President William Ruto has announced a $177 billion budget cut to plug the budget hole left by the withdrawal of the Finance Bill. The move comes after protests led to the reversal of controversial tax hikes, which led to the deaths of 39 people.

The country descended into chaos as peaceful protests against tax hikes turned violent, with police firing on crowds who stormed parliament.

Led mainly by young Kenyans, the protests reflected widespread anger over the annual budget bill that Ruto had to abandon, warning of a huge funding shortfall.

“We will propose to the National Assembly a budget cut not of the entire 346 billion, but a budget cut of 177 billion and a borrowing of the difference (about 169 billion shillings),” Mr Ruto said on Friday, July 5.

Public debt stands at about 10 trillion shillings ($78 billion), or about 70 percent of Kenya’s GDP.

The decision to borrow would increase the budget deficit “by 3.3% to 4.6%”, Ruto said, but would allow some services to be financed.

These measures would include hiring high school teachers and medical interns, as well as continuing to fund a milk stabilization and fertilizer program that protects farmers.

Ruto announced several austerity measures, including the absorption of 47 state-owned organisations and enterprises by other ministries.

The positions of first lady and vice-president’s wife will disappear and the number of government advisers will be reduced by half.

“All non-essential travel by government and public service employees is hereby suspended,” he added.