National Treasury Cabinet Secretary John Mbadi has told the Senate that the government has adopted a multi-pronged approach to manage the prevailing fiscal deficit in the country.
Mbadi who was before the Senate plenary to answer questions said that strengthening financial controls through diverse borrowing, improving the debt repayment planning and promoting efficient resources allocation were some of the measures which will be deployed.
Responding to Nominated Senator Karen Nyamu who sought to know the medium-term strategy being carried out by the National Treasury to reduce the fiscal deficit from 4.9 per cent to a sustainable level, Mbadi said he would focus on revenue generation and sustainable expenditure control. "For example, in the financial year 2025/26, given the projected expenditures and revenues, the fiscal deficit including grants is projected at Sh831.0 billion (4.3 percent of GDP) compared to the projected fiscal deficit of Sh862.7 billion (4.9 percent of GDP) in financial year 2024/25," said Mbadi.
The CS told the Senate that the fiscal deficit in financial year 2025/26 will be financed by a net external financing of Sh146.8 billion (0.8 percent of GDP) and a net domestic financing of Sh684.2 billion (3.6 percent of GDP).
