COUNTY GOVERNMENT OF WEST POKOT COUNTY TREASURY COUNTY BUDGET REVIEW AND OUTLOOK PAPER SEPTEMBER 2022 Foreword It is with great pleasure that the County Treasury presents the County Budget Review and Outlook Paper (CBROP) for West Pokot County Government for the FY 2021/2022. This report has been prepared in line with Section 118 of The Public Finance Management Act, 2012 which requires every County Government to prepare and submit a County Budget Review and Outlook Paper (CBROP) to the County Assembly. The Kenyan economy demonstrated remarkable resilience and recovery to the COVID-19 shock due to the diversified nature of the economy and the proactive measures by the Government to support businesses. The economy expanded by 7.5 percent in 2021, a much stronger level from a contraction of 0.3 percent in 2020. This economic recovery was mainly supported by the recovery in the service and industry sectors despite the subdued performance in the agricultural sector. Growth is expected to remain resilient growing by 5.8 percent in FY 2022/23 and averaging 6.2 percent over the medium term. This will be supported by a broad-based private sector growth, including recoveries in agriculture. This outlook will be reinforced by the ongoing implementation of the strategic priorities under the “Big Four” Agenda and the Economic Recovery Strategy. The overall total projected revenue for FY 2021/2022 was estimated at Kshs. 7.671 Billion. In the period under review, the Controller of Budget approved withdrawals amounting to Kshs.6.629 Billion from the County Revenue Fund Account. The total expenditure during the review period amounted to Ksh.6.644 Billion representing 86 per cent of the total budget. This expenditure comprised of Ksh. 5.009 Billion for recurrent and Ksh. 1.634 Billion for development respectively. Several milestones were achieved in each sector as contained in the detailed report during the period under review. The report further sets indicative ministerial ceilings for FY 2023/2024 in line with key sector strategic objectives and priorities as set out in the County Integrated Development Plan (2023-2027) and MTP IV of Kenya Vision 2030. Our commitment is to ensure that we realise the County’s goal of reducing poverty and creating employment by focusing our expenditure on high impact projects and programmes. In this regard, the need for continued fiscal discipline through strategic planning, efficient resource management and prudent utilization of public resources is emphasized. God bless our County. Ruth Kisabit County Executive Committee Member for Finance and Economic Planning i Acknowledgement The 2022 County Budget Review and Outlook Paper has been prepared in accordance with the Public Finance Management (PFM) Act, 2012 and its Regulations. The document provides the fiscal outturn for the FY 2021/2022, the macro-economic projections and sets the tentative sector ceilings for the FY 2023/24 and the Medium Term Budget. The document also provides an overview of how the actual performance of the FY 2021/2022 affected compliance with the Fiscal Responsibility Principles and the Financial Objectives spelt out in the PFM Act. The economy is operating under tight global financial condition as a result of the ongoing Russia-Ukraine conflict and higher than expected inflation worldwide. This calls for prioritization on Government projects that will ensure our economy remains resilient and continue to register growth, and will have the highest impact and benefits to Kenyans. Therefore, All Sector Working Groups are expected to ensure that their budgets are aligned to the government priorities while taking into account the resource constraints. The preparation of the 2022 CBROP was a collaborative effort of various County departments. We thank all the County Departments and Agencies for the timely provision of useful data and information on their budget execution for the FY 2021/22. I also wish to thank the core team from the County Planning and Budget Unit for reviewing this document to ensure it satisfies the PFM Act, 2012 and sets out the sector ceilings that will guide the rest of the sectors in the preparation of their FY 2023/2024 and the Medium Term Budget. Finally, I wish to reiterate the importance of public participation in FY 2023/2024 Medium Term Budget preparation process by calling on all Sector Working Groups to devise an engagement framework that will deepen open public and stakeholders’ participation and incorporation of the proposals received God bless you all. Dr.Grace Amurle Chief Officer, Finance & Economic Planning ii Table of Contents Foreword ..............................................................................................................................i Acknowledgement ................................................................................................................ ii Abbreviations and Acronyms ................................................................................................v List of Tables ........................................................................................................................ vi I. INTRODUCTION .............................................................................................................. 1 1.1 Legal Basis for the Preparation of CBROP ..................................................................... 1 1.2 Specific Objectives of County Budget Review and Outlook Paper ..................................... 1 II. REVIEW OF FISCAL PERFORMANCE .............................................................................. 2 2.1 Overview of Resource Envelope ...................................................................................... 2 2.2 Summary of Fiscal Performance ....................................................................................... 3 2.2.1 Analysis of Exchequer Issues .................................................................................................. 3 2.2.2 Analysis of Local Revenue Performance ................................................................................ 3 2.3 County Expenditure Performance .................................................................................... 4 2.3.1 Summary of Recurrent Expenditure by Subsector ................................................................. 4 2.3.2 Summary of Development Expenditure by Subsector ........................................................... 5 2.3.3 Summary of Recurrent Expenditure by Economic Classification ........................................... 6 2.3.4 Analysis of Performance of Conditional Grants/Loans .......................................................... 7 2.4 Key Sector Performance ................................................................................................... 8 2.5 Implication of Fiscal Performance on Fiscal Responsibility Principles and Financial Objectives ............................................................................................................................ 10 III. RECENT ECONOMIC DEVELOPMENT AND POLICY OUTLOOK ................................ 12 3.0 Overview of Recent Economic Performance and Outlook .............................................. 12 3.1 Inflation Rate and Interest Rates ...................................................................................... 13 3.2 Kenya Shilling Exchange Rate .......................................................................................... 14 3.3 Money and Credit .......................................................................................................... 14 3.4 Private Sector Credit ....................................................................................................... 15 3.5 External Sector Developments ........................................................................................ 15 3.6 Foreign Exchange Reserves ............................................................................................. 15 3.7 Fiscal Policy Outlook ...................................................................................................... 16 3.8 Risks to the Domestic Economic Outlook ........................................................................ 16 IV. MTEF RESOURCE ALLOCATION FRAMEWORK ......................................................... 17 4.1 Revenue Outlook ............................................................................................................ 17 4.2 Fiscal Projections for FY 2023/2024- 2025/2026 MTEF Period ....................................... 17 4.2.1 Internal Revenue Streams’ Projections for FY 2022/23-FY 2025/26 ................................... 18 iii 4.2.2 Projected Medium Term Revenue & Expenditure Framework ........................................... 19 4.3 Expenditure Priorities for FY 2023/2024 –FY 2025/26 MTEF Period .............................. 19 V. CONCLUSION ............................................................................................................... 21 Annex 1: Budget Calendar.................................................................................................. 22 iv Abbreviations and Acronyms CBROP Budget Review And Outlook Paper CFSP County Fiscal Strategy Paper CIDP County Integrated Development Plan ADP Annu al Development Plan GDP Gross Domestic Product MTEF Medium Term Expenditure Framework PFM Public Finance Management Act FY Financial Year CRF County Revenue Fund CARA County Allocation Revenue Act MTP Medium Term Plan v List of Tables Table 1: Total Projected Resource Envelope for FY 2021/2022 .................................................................... 2 Table 2: Local Revenue Streams and Performance ...................................................................................... 3 Table 3: Summary of Recurrent Expenditure ............................................................................................... 4 Table 4: Summary of Development Expenditure........................................................................................... 5 Table 5: Summary of Personal Emoluments Expenditure ............................................................................ 6 Table 6: Summary of Operation and Maintenance Expenditure .................................................................. 6 Table 7: Conditional Grants Performance .................................................................................................... 7 Table 8: Sectoral GDP Performance ............................................................................................................ 12 Table 9: Fiscal Projections for FY 2023/2024- 2025/2026 MTEF Period .................................................... 17 Table 10: Internal Revenue Projections by Stream Targets ........................................................................ 18 Table 11: Expenditure Forecast for FY 2023/24-FY 2025/26 ...................................................................... 19 Table 12: FY 2022/23- FY 2023/24 MTEF CEILINGS ................................................................................ 20 Table 13: Budget Calendar .......................................................................................................................... 22 vi I. INTRODUCTION 1.1 Legal Basis for the Preparation of CBROP The County Budget Review and Outlook Paper has been prepared in accordance with Section 118 of the Public Financial Management Act, 2012. This section states that: a) The County Treasury shall prepare and submit to the County Executive Committee for approval in each financial year, a County Budget Review and Outlook Paper by 30th September of that year. b) County Executive Committee shall consider the CBROP with a view to approving it with or without amendments, not later than fourteen days after its submission. c) Not later than seven days after the CBROP has been approved by Executive committee, the County Treasury shall: i. Submit the paper to the Budget and appropriation Committee of the County Assembly to be laid before the County Assembly; and ii. Publish and publicize the paper not later than fifteen days after laying the Paper before County Assembly. 1.2 Specific Objectives of County Budget Review and Outlook Paper The main objectives of the CBROP 2022 are; a) To provide an analysis of actual fiscal performance in the FY 2021/2022 compared to the budget appropriation for that year. b) To provide updated economic and financial forecasts with sufficient information to show changes from the forecasts in the most recent County Fiscal Strategy Paper. c) To provide information on any changes in the forecasts compared with the County Fiscal Strategy Paper; or how actual financial performance for the previous financial year may have affected compliance with the fiscal responsibility principles or the financial objectives in the latest CFSP; and d) To give the reasons for any deviation from the financial objectives together with proposals to address the deviation and the time estimated to do so. 1 II. REVIEW OF FISCAL PERFORMANCE 2.1 Overview of Resource Envelope Table 1: Total Projected Resource Envelope for FY 2021/2022 PROJECTED REVENUE FY 2021/22 FY 2021/22 FY 2021/22 Supplementary Supplementary Approved (Kshs) Adjustment I (Kshs) II (Kshs) 1. National Revenue a.) Equitable share 6,297,284,329.00 - 6,297,284,329.00 6,297,284,329.00 c.) Grants/Loans 559,953,126.00 - 559,953,126.00 559,953,126.00 d.) Balance b/d 586,711,191.00 57,730,703.00 644,441,894.00 644,441,894.00 2. Own Revenue Sources e.) Projected Revenue From Local Sources 170,000,000.00 - 170,000,000.00 170,000,000.00 7,613,948,646.00 - 7,671,679,349.00 7,671,679,349.00 Total Source: West Pokot County Treasury, 2022 The table above provides estimates of revenue projection for the FY 2021/2022 supplementary II budget estimates. The overall total projected revenue was estimated at Kshs. 7,671,679,349.00. This projected revenue comprised of equitable share of Kshs. 6,297,284,329.00. Conditional allocation from external grants from development partners was projected at Ksh. 559,953,126.00 constituting 7.3 per cent of the total projected supplementary estimates. This comprised of conditional allocation of Ksh. 353,574,020 for financing the Kenya Climate Smart Agriculture Project, Ksh. 66,268,057.00 for Kenya Devolution Support Programme level 2 grant, Ksh. 32,310,513.00 for Agriculture Sector Development Support Programme II, and Ksh.51,216,786.00 for Transforming Health Systems for Universal Care Project. Others are allocation of Ksh.11 million for Instruments for Devolution & Advice and Support (Nasukuta Project), Ksh.11,079,750.00 for Danida and Ksh. 34,504,000 to finance Emergency Locust Response Project. The balance brought forward from FY 2020/21 was estimated at Ksh. 644,441,894.00.This balance represented 8.4 per cent of total supplementary budget estimates. It comprised of equitable share amounting to Ksh. 500,896,372.00, conditional grant of Ksh. 3,317,255.00 for DANIDA, conditional grant of Ksh. 6,417,121.00 for Covid-19 Response and Ksh.11, 725,115.00 for Agriculture Sector Development Support Programme II. Others are Ksh. 10 million for user fees, Ksh. 379,478.00 for County Polytecnics, Ksh.22,495,190.00 conditional allocation from Roads Maintenance Fuel Levy Fund, Ksh. 35,256,980.00 Level I grant for Kenya Devolution Support Programme, Ksh. 16,129,541.00 for Transforming Health 2 Systems for Universal Health Coverage and Ksh. 37,824,842.00 for Kenya Urban Support Programme. The FY 2021/22 local revenue target was projected at Kshs. 170,000,000.00 representing 2.2 per cent of the total projected revenue. This comprised of net local revenue target of Ksh. 97.2 million and Appropriations in Aid (F.I.F) for Health amounting to Ksh. 72.8 million. 2.2 Summary of Fiscal Performance 2.2.1 Analysis of Exchequer Issues In the period under review, the Controller of Budget approved withdrawals of Kshs. 6,629,278,530.70.00 from the CRF account. The exchequer issues from the Consolidated Fund comprised of equitable share of Ksh. 6,297,284,328.70 and conditional grants amounting to Ksh. 331,994,202.00. The exchequer issues comprised of Ksh. 2.20 billion and Ksh. 4.43 billion for development and recurrent expenditure respectively. These withdrawals represented 86.41 percent of the approved supplementary budget and translated to an increase of 5.11 per cent from Kshs. 5.86 billion in FY 2020/21. 2.2.2 Analysis of Local Revenue Performance Table 2: Local Revenue Streams and Performance Revenue Source Actual Revenue Actual Projection FY Actual Performance Revenue 2021/2022 Revenue Performance Performance FY 2019/20 2020/21 2021/22 2021/22 Kiosk Rent 2,618,680.00 1,098,800.00 1,810,382.00 Single Business Permit 14,325,363.65 11,474,472.25 19,000,000.00 7,583,990.00 Market Fee 1,058,695.00 1,449,310.00 4,000,000.00 1,284,187.00 Building Approvals 508,386.00 2,589,320.00 451,116.00 Cess 5,289,330.00 3,796,028.00 6,260,345.00 24,021,393.00 Royalties 17,662,280.00 18,969,563.00 31,109,653.00 Stock Cess/slaughter 2,895,520.00 3,002,065.00 7,000,000.00 House Rent 3,807,175.10 1,883,913.00 2,083,664.00 2,913,867.00 Advertising 661,400.00 3,033,510.15 857,487.00 1,157,292.00 Parking Fee 502,575.00 667,480.00 1,308,132.00 3,320,178.00 Bus Park and Motorcycle 2,128,625.00 4,815,810.00 5,950,000.00 Renewals/Applications 485,500.00 1,038,300.00 1,704,410.00 Liquor Licensing 0 77,500.00 500,000.00 Agriculture 919,861.00 Other fees and charges (public 11,837,674.00 2,504,138.82 2,255,431.00 2,033,362.00 toilet, honey, hides & skin, firewood, tarmarind aloevera, fish, scrapmetal, penalties,) 3 Health(cost sharing and public 29,000,000 - health) Lands(Plot/Land Rates) 202,000.00 11,164,824.08 9,838,819.00 5,630,937.00 Livestock/Permits 274,570.00 256,400.00 700,700.00 Appropriation in Aid(FIF- 12,755,000.00 40,930,326.85 72,800,000.00 64,020,327.00 Health) Receipt from admin. fees and 59,140.00 50,000.00 1,415,719.00 charges Public Health Facilities Fee 144,150.00 - Forest Products Fees 989,706.00 1,630,788.85 1,400,000.00 Grand Total 107,146,629.75 110,441,690.00 170,000,000.00 113,381,252.00 Source: West Pokot County Treasury, 2022 Receipts from Local Revenue in the period under review amounted to Kshs. 113,381,252.00 against a target of Kshs. 170 million in the FY 2021/2022. This represents local revenue performance of 66.69 per cent. There was an overall increment in the collection of revenue by the county by Ksh. 2.94 million in comparison with the local revenue collected in the FY 2020/2021. 2.3 County Expenditure Performance The total actual expenditure for the period under review amounted to Ksh. 6,644,271,618.00. This represents an overall performance of 86.61 percent. This comprised of expenditure of Ksh. 5,009,793,390.00 for recurrent and Ksh. 1,634,478,228.00 for development. 2.3.1 Summary of Recurrent Expenditure by Subsector Table 3: Summary of Recurrent Expenditure VOTE /DEPARTMENT APPROVED RECURRENT EXPENDITURE % County Executive 362,473,868.00 359,393,935.00 99.15 Finance and Economic Planning 255,515,232.00 232,892,211.00 91.15 Public Works, Transport and 72,250,230.00 69,253,888.00 95.85 Infrastructure Health , Sanitation and Emergency 2,105,155,141.00 2,072,218,143.00 98.44 Services Education and Technical Training 856,659,774.00 834,711,327.00 97.44 Agriculture and Irrigation 80,311,315.00 77,522,165.00 96.53 Pastoral Economy 81,600,469.00 77,333,969.00 94.77 Trade, Industrialization and Cooperative 123,339,386.00 117,496,200.00 95.26 Development Lands, Housing, Physical Planning And 97,325,657.00 90,865,867.00 93.36 Urban Development Water , Environment and Natural 97,300,732.00 89,589,844.00 92.08 Resources Youths, Sports, Tourism, Gender and 94,747,064.00 87,478,883.00 92.33 Social Services. West Pokot County Assembly 652,173,508.00 635,413,078.00 97.43 4 Public Service, ICT and Decentralized 224,254,965.00 221,436,469.00 98.74 Units Special Programmes and Directorates 47,486,344.00 44,187,411.00 93.05 Total 5,150,593,685.00 5,009,793,390.00 97.27 Source: West Pokot County Treasury, 2022 Recurrent expenditure for the period under review represented an absorption rate of 97.27 percent of the annual recurrent budget. This is higher than the 96.6% absorption rate recorded in FY 2020/21. The County Executive and County Public Service Management had the highest absorption rate at 99.2 and 98.7 per cent respectively while the Department of Finance and Economic Planning had the least absorption rate of 91.1 percent. 2.3.2 Summary of Development Expenditure by Subsector Table 4: Summary of Development Expenditure VOTE /DEPARTMENT APPROVED EXPENDITURE % DEVELOPMENT BUDGET County Executive 160,475,445.00 64,812,500.00 40.39 Finance and Economic Planning 138,904,345.00 80,148,018.00 57.70 Public Works, Transport and 403,669,807.00 337,763,576.00 83.67 Infrastructure Health , Sanitation and Emergency 286,472,318.00 155,322,918.00 54.22 Services Education and Technical Training 293,264,773.00 260,779,268.00 88.92 Agriculture and Irrigation 481,078,020.00 289,715,660.00 60.22 Pastoral Economy 196,111,359.00 124,878,901.00 63.68 Trade, Industrialization and 81,695,441.00 44,621,465.00 54.62 Cooperative Development Lands, Housing, Physical Planning 62,083,026.00 28,233,149.00 45.48 And Urban Development Water , Environment and Natural 328,863,106.00 189,646,319.00 57.67 Resources Youths, Sports, Tourism, Gender and 55,533,991.00 36,205,778.00 65.20 Social Services. West Pokot County Assembly 32,934,033.00 22,350,676.00 67.86 Public Service, ICT and Decentralized - 0.00 Units Special Programmes and Directorates - - Total 2,521,085,664.00 1,634,478,228.00 64.83 Source: West Pokot County Treasury, 2022 Development expenditure for the period under review represented an absorption rate of 64.83 per cent of the approved development budget. This performance represented an overall performance of 24.6 per cent of total expenditure. The Departments of Education and Technical Training and Public Works ,Transport and Infrastructure and County Assembly had the highest absorption rates at 88.92 per cent, 83.67 per cent and 67.86 per cent respectively while Departments of Health ,Sanitation and Emergency Services, Lands, 5 Housing, Physical Planning and Urban Development and County Executive, had the least absorption at 54.22%, 45.48 % and 40.39 % respectively. 2.3.3 Summary of Recurrent Expenditure by Economic Classification Table 5: Summary of Personal Emoluments Expenditure Vote Allocation IPPD Expenditure On Total % Expenditure Casuals Expenditure County Executive 157,087,185.00 122,296,574.30 158,456,078.30 100.87 36,159,504.00 Finance and Economic 107,008,522.00 86,335,192.00 17,427,876.00 103,763,068.00 96.97 Planning Roads, Public Works 44,266,286.00 42,502,661.00 1,537,813.00 44,040,474.00 99.49 and Transport Health and Sanitation 1,659,195,522.00 1,572,425,576.15 35,555,865.00 1,607,981,441.15 96.91 Education and 272,351,301.00 167,587,122.00 86,259,070.00 253,846,192.00 93.21 Technical Training Agriculture And 61,460,190.00 47,337,195.00 13,492,713.00 60,829,908.00 98.97 Irrigation Pastoral Economy 57,806,613.00 45,179,379.00 12,372,400.00 57,551,779.00 99.56 Trade, Investments 70,221,786.00 60,960,074.00 8,485,443.00 69,445,517.00 98.89 and Cooperative Development Lands, Housing, 53,810,197.00 22,424,526.00 28,008,800.00 50,433,326.00 93.72 Physical Planning and Urban Development Water Dev., 51,074,508.00 39,011,824.00 10,740,000.00 49,751,824.00 97.41 Environment and Natural Resources Tourism, Culture, 45,422,504.00 38,824,861.00 6,564,088.00 45,388,949.00 99.93 Sports, Youth and Gender Dev. West Pokot County 283,997,413.00 284,818,570.00 43,010,218.00 327,828,788.00 115.43 Assembly County Public Service 72,670,266.00 45,881,977.00 26,432,300.00 72,314,277.00 99.51 Management, ICT & Decentralized Units Special Programmes 17,844,444.00 16,023,339.00 - 16,023,339.00 89.79 and Directorates Total Recurrent 2,954,216,737.00 2,591,608,870.45 326,046,090.00 2,917,654,960.45 98.76 Budget Source: West Pokot County Treasury, 2022 In the period under review, the county government spent Kshs.2.893 billion on personnel emoluments. This represents an increase of 8.15 percent (Ksh. 218.0 million) annual increment when compared to expenditure on wage bill for FY 2020/2021. The Expenditure on personnel emoluments represents 56.17 per cent of total recurrent expenditure and 37.17 per cent of total approved budget. Table 6: Summary of Operation and Maintenance Expenditure Vote/Department Personnel Emolument Operation & Total Recurrent Maintenance Expenditure County Executive 229,152,731.35 176,769,467.65 405,922,199.00 Finance and Economic Planning 150,941,288.90 132,424,742.10 283,366,031.00 6 Roads, Public Works and Transport 65,168,467.50 8,950,182.50 74,118,650.00 Health and Sanitation 1,228,314,155.20 337,618,462.80 1,565,932,618.00 Education and Technical Training 248,789,274.55 240,897,576.45 489,686,851.00 Agriculture And Irrigation 79,920,770.40 21,919,504.60 101,840,275.00 Pastoral Economy 75,605,042.35 18,283,918.65 93,888,961.00 Trade, Industry and Cooperative 67,059,230.75 47,679,901.25 114,739,132.00 Development Lands, Housing, Physical Planning and 69,492,168.80 34,330,449.20 103,822,618.00 Urban Development Water Dev., Environment and Natural 55,553,657.70 17,298,310.30 72,851,968.00 Resources Tourism, Culture, Sports, Youth and 41,815,064.40 30,801,379.60 72,616,444.00 Gender Dev. West Pokot County Assembly 269,973,510.00 319,962,131.00 589,935,641.00 County Public Service Management, 78,792,143.35 161,947,191.65 240,739,335.00 ICT & Decentralized Units Special Programmes and Directorates 14,823,924.75 24,250,171.25 39,074,096.00 Total 2,675,401,430.00 1,573,133,389.00 4,248,534,819.00 Source: West Pokot County Treasury, 2022 A total of Kshs.1.573 billion was spent on operations and maintenance expenses during the reporting period compared to Kshs. 1.54 billion spent in the FY 2020/202. This expenditure represented 23.7 per cent of total expenditure. 2.3.4 Analysis of Performance of Conditional Grants/Loans Table 7: Conditional Grants Performance Conditional Grants/Loans(National Approved Total Amount Received % Government Supplementary FY FY 2021/2022 2021/2022 Emergency Locust Response Project 34,504,000.00 12,292,914.00 35.63 Transforming Health Systems for 51,216,786.00 43,146,498.00 84.24 Universal Care Project EU IDEAS-Nasukuta Project 11,000,000.00 1,120,781.00 10.19 Kenya Devolution Support Programme 66,268,057.00 66,268,057.00 100.00 Kenya Climate Smart Agriculture 353,574,020.00 197,626,077.00 55.89 Project ASDSP II 32,310,513.00 6,000,000.00 18.57 DANIDA 11,079,750.00 5,539,875.00 50.00 Total 559,953,126.00 331,994,202.00 59.29 Source: West Pokot County Treasury, 2022 The conditional grants received from national government and other development partners amounted to Ksh.331,994,202.00. This represents a performance of 59.29 percent of the total projected grants. 7 2.4 Key Sector Performance 2.4.1 Energy, Infrastructure & ICT In the period under review, the county government constructed 2 foot bridges, maintained a total of 300 km of county roads , 228 km of new roads were opened up and purchased one motor grader. Several infrastructure projects are going on across all departments. A new revenue system was also procured, tested and operationalized. 2.4.2 Agriculture, Rural and Urban Development The Department of Agriculture and Pastoral Economy is the leading department in food security initiatives. In the period under review, the department achieved the following milestones: procured and distributed 87,500kgs bales of assorted certified seed varieties, A total of 18,878 acres of land was ploughed through the County Agricultural Machinery Services.42,680 farmers were also trained on irrigation agronomy and 2500 were newly registered. In the livestock subsector, the department achieved the following key milestones; supplied 943 improved Sahiwal bulls, 20 camels’ breeds, 4308 Galla goat breeds and 283 wool sheep. To control and prevent livestock diseases the department supplied 971-foot spray pumps to farmers and conducted vaccination to 808,722 cattle and 1,147,625 sheep/goats. It also established also 300 hectares of boma rodes and 3 hay stores at Nasukuta farm. A total of 40 cattle dips were constructed ,30 metallic crushes,23 cattle dips were repaired .A total of 17 veterinary and livestock officers were recruited. 2.4.3 Health The following is a summary of achievements and progress realized during the period under review. To reduce preventable disease incidences in order to lower the county disease burden, Proportion of children under one year fully immunized reduced from 50.4 to 50.2 percent, while Proportion of pregnant women attending 4th ANC visit increased from 22 to 23 percent percent and Proportion of deliveries conducted by skilled attendants increased from 44.5 to 51.3 percent. To improve access to quality and affordable curative services for a healthy society, the department constructed and operationalized a modern laboratory in Chepareria Sub County Hospital, constructed drugs store at Kacheliba Sub County Hospital, installed 12 solar powered vaccine fridges, purchased 10 delivery beds, operationalized Sebit and Kiwakan new dispensaries and inaugurated new dialysis services at the Renal Unit in Kapenguria County Referral Hospital. To improve water, hygiene standard and general 8 environmental sanitation the department established 50 new community health units and 500 new Community Health Volunteers trained on basic module for integrated community health services. 2.4.4 Education A total of 30,000 needy students benefited from the county bursary scheme. The construction of peace schools at Akulo, Kanyerus and Katikomor are also nearing completion. The department also rehabilitated 6 Vocational Training Centres, 370 ECDE classrooms were constructed and completed. 104 Primary and Secondary schools were also supported with infrastructure support .A total of 180 ECDE teachers were trained on Competency Based Curriculum. 2.4.5 General Economic & Commercial Affairs The department mandate is outlined in the Fourth Scheduled of the Constitution as follows: Trade development and regulation which includes: market infrastructure development, Trade Licensing, regulation, enforcement of fair trade practices and development of Cooperatives Societies. In the FY 2021/22 department implemented the following projects; ongoing construction of Mango processing plant in Lomut ward and Milk processing plant in Lelan ward. To enhance livelihoods through increased income, the department conducted 19 cooperative boards of management were trained, 7 new cooperatives were registered, and 4 dormant cooperatives were revived with aim of promoting of cooperative movement. The department also managed to audit books of accounts for 15 (fifteen) cooperative societies and also issued loans amounting to 22,700,000 from Cooperative Development Fund to 11 Cooperative societies. 2.4.6 Environmental Protection, Water & Natural Resources The following is a summary of achievements and progress realized during the period under review. To increase access and availability of adequate water resources; the department upgraded 9 boreholes from hand pump to solar and drilled 2 boreholes and equipped it. The department also developed Climate Change Fund regulations. 12 sand dams were also constructed, 20 community tree nurseries supported and 6 water supply scheme constructed and rehabilitated. 2.4.7 Social Protection, Culture & Recreation In the FY 2021/2022 the department implemented the following projects; protected 50 percent of Nasolot Game reserve. The County Government in collaboration with KWS, NRT and STE collared some elephants in Nasolot game reserve. An MOU between county government and NRT on community conservancy was signed. Further, a total of 600,000 9 community members were educated on importance of conservation of cultural artefacts reached through radio talk shows held. To empower youth and enhance gender equality, the department conducted 4 campaigns; sensitized 1200 people against FGM. Operationalized 4 youth empowerment Centres. To improve heritage and culture awareness, knowledge appreciation and conservation, 4 new cultural sites were identified. Construction of Mtelo- Cottages is also nearing completion. 2.4.8 Public Administration & International Relations The Department of Public Service, ICT and Decentralized Units aims to transform the county public service to be professional, efficient and effective for the realization of county development goals. In the FY 2021/22 the department implemented the following projects; construction of County Commissioner Office and the new Governor’s annex building. Performance contracts and appraisals were also carried out for all senior staffs, and a total of 87 staff were sensitized on performance management,15 officers were also trained on HRD Policy and 9 officers on senior management course at KSG. The department of Finance and Economic Planning prepared the annual development plan, CBROP, budget estimates, County Fiscal Strategy Paper & Debt Management Strategy Paper, Procurement Plans and the Annual Progress Reports and were all approved. Public participation on county budget process was also carried out in all the 20 wards during the review period. A total of Ksh. 79.8 million pending bills were also settled during the review period. 2.5 Implication of Fiscal Performance on Fiscal Responsibility Principles and Financial Objectives From the above fiscal performance, it can be observed that the fiscal responsibility principles and financial objectives were largely met as follows; a) Development expenditure for the period under review represented an absorption rate of 64.83 per cent of the approved development budget. This performance represented an overall performance of 24.6 per cent of total expenditure. This is below the 30 percent expenditure threshold required by law. b) The county government spent Kshs.2.918 billion on personnel emoluments. This is an increase of 9 percent (Ksh. 243 million) increment when compared to expenditure on compensation for employees for FY 2020/2021. This expenditure represents 43.92 per cent of total expenditure. This is above the 35 percent expenditure threshold required by law. The expenditure on wages and benefits to its county public officers is unsustainable over the medium term. c) No borrowings were made during the review period. Over the medium term, the county government’s borrowings shall be used only for the purpose of financing development expenditure and not for recurrent expenditure. 10 d) Public debt/ Pending bills and obligations were maintained at a sustainable level and fiscal risks was managed prudently and e) A reasonable degree of predictability with respect to the level of tax rates and tax bases was also maintained. 11 III. RECENT ECONOMIC DEVELOPMENT AND POLICY OUTLOOK 3.0 Overview of Recent Economic Performance and Outlook The Kenyan economy demonstrated remarkable resilience and recovery to the COVID-19 shock due to the diversified nature of the economy and the proactive measures by the Government to support businesses. The economy expanded by 7.5 percent in 2021, a much stronger level from a contraction of 0.3 percent in 2020. This economic recovery was mainly supported by the recovery in the service and industry sectors despite the subdued performance in the agricultural sector. Growth is expected to remain resilient growing by 5.8 percent in FY 2022/23 and averaging 6.2 percent over the medium term. This will be supported by a broad-based private sector growth, including recoveries in agriculture while the public sector consolidates. This outlook will be reinforced by the ongoing implementation of the strategic priorities of the Government under the “Big Four” Agenda and the Economic Recovery Strategy. Additionally, the Government is implementing the third phase of the Economic Stimulus Programs that target strategic interventions in agriculture, health, education, drought response, policy, infrastructure, financial inclusion, energy, and environmental conservation. Table 8: Sectoral GDP Performance Sectors 2020 2021 2022 Q1 Q2 Q3 Q4 Q1-Q4 Q1 Q2 Q3 Q4 Q1- Q1 Q4 Primary industry 4.6 7.8 (3.9) 9.6 4.7 0.9 0.02 1.4 0.7 0.7 0.5 Agriculture, Forestry 4.5 8.0 (4.3) 9.8 4.6 0.4 (0.5) 0.6 (1.2) (0.2) (0.7) and Fishing Mining and 6.5 3.9 5.6 6.0 5.5 10.7 10.9 16.4 34.5 18.0 22.1 Quarrying Secondary sector 3.8 (1.6) 2.5 7.8 3.2 3.9 9.1 8.3 5.0 6.5 4.4 (Industry) Manufacturing 1.4 (5.4) (2.2) 4.3 (0.4) 2.1 11.3 10.2 4.9 6.9 3.7 Electricity and water 1.5 (4.5) 0.8 4.6 0.6 3.6 7.2 6.4 2.8 5.0 1.9 supply Construction 8.9 6.0 10.2 15.2 10.1 6.8 6.8 6.7 6.0 6.6 6.4 Tertiary 3.9 (6.6) (4.2) (0.04) (1.8) 3.2 14.9 11.4 9.1 9.6 9.1 sector(services) Wholesale and retail 5.5 (3.8) (5.1) 1.4 (0.5) 7.5 9.2 6.4 8.4 7.9 8.7 trade Accommodation and (14.1) (57.2) (62.0) (57.7) (47.7) (33.0) 90.1 127.5 118.6 52.5 56.2 restaurant Transport and 2.1 (16.8) (10.2) (6.2) (7.8) (7.9) 18.6 14.2 6.5 7.2 8.1 storage Information and 7.8 4.9 4.9 7.5 6.3 10.1 17.1 4.1 5.3 8.8 6.1 communication Financial and 6.2 3.2 3.3 10.6 5.9 11.8 17.3 11.8 9.9 12.5 14.4 insurance Public 4.7 4.5 8.3 10.2 7.0 6.8 7.6 4.8 3.3 5.6 6.4 Administration others 3.5 (8.1) (5.4) (2.1) (3.2) 3.5 14.8 12.6 9.8 10.3 7.4 Of which 2.7 (25.5) (18.4) (12.5) (13.7) (13.0) 18.3 13.4 8.1 5.7 14.9 12 professional, Admin & support Services Real Estate 4.1 3.6 3.8 4.8 4.1 6.7 7.4 7.1 5.7 6.7 6.1 Education 4.8 (21.1) (16.1) (4.8) (9.3) 11.5 31.6 28.3 18.0 21.4 6.2 Health 7.1 9.0 4.4 2.9 5.7 5.8 6.2 4.1 7.8 6.0 5.0 Taxes less subsidies 5.5 (20.5) (8.5) (7.4) (8.1) 1.8 18.5 12.5 15.7 11.9 12.3 Real GDP 4.4 (4.1) (3.5) 2.3 (0.3) 2.7 11.0 9.3 7.4 7.5 6.8 0f which Non- 4.2 (5.6) (2.7) 1.9 (0.6) 3.4 14.0 11.0 8.5 9.1 8.3 Agriculture Source: Kenya National Bureau of Statistics 3.1 Inflation Rate and Interest Rates The year-on-year inflation rate increased to 8.5 percent in August 2022 (above the 7.5 percent upper bound) from 6.6 percent in August 2021 mainly due to higher food and fuel prices. This increase was moderated by Government measures to stabilize fuel prices, lower electricity tariffs and subsidies on fertilizer prices. Additionally, the waiver of import duties and levies on white maize and the reduction in VAT on LPG will further moderate domestic prices. Overall annual average inflation remained within Government target range at 6.6 percent in August 2022 compared to the 5.7 percent recorded in August 2021. Food inflation remain the main driver of overall year-on-year inflation in August 2022, contributing 5.9 percentage points, an increase, compared to a contribution of 3.9 percentage points in August 2021. The increase was mainly attributed to dry weather conditions and supply constraints that resulted in a rise in prices of key food items particularly maize flour (loose), sugar, maize grain (loose), carrots, white rice, Irish potatoes and onions. Fuel inflation remained generally stable contributing to 1.6 percentage points to year-on year overall inflation in August 2022 from a contribution of 1.5 percentage points in August 2021. This was mainly due to the effect of Government measures to stabilize fuel prices and lower electricity tariffs. However, there was notable increase in the prices of kerosene/paraffin, petrol and diesel in August 2022 compared to August 2021. The contribution of core inflation to year-on-year overall inflation has been low and stable, consistent with the muted demand pressures in the economy on account of prudent monetary policies. The contribution of core inflation to overall inflation remained stable at 1.0 percentage points in August 2022 compared to 0.9 percentage points contribution in August 2021. Short-term interest rates remained fairly low and stable supported by ample liquidity in the th money market. The Central Bank Rate was raised from 7.0 percent to 7.5 percent on 30 May 2022. The tightening of the monetary policy stance was to anchor inflation expectations due to the elevated risks to the inflation outlook as a result of increased global commodity prices 13 and supply chain disruptions. The interbank rate increased to 5.4 percent in August 2022 compared 3.1 percent in August 2021. Interest rates on the Treasury bills remained relatively low (below 10 percent) in August 2022. The 91-day Treasury Bills rate was at 8.6 percent in August 2022 compared to 6.6 percent in August 2021. Over the same period, the 182-day Treasury Bills rate increased to 9.5 percent from 7.1 percent while the 364-day also increased to 9.9 percent from 7.4 percent. 3.2 Kenya Shilling Exchange Rate The foreign exchange market has largely remained stable despite the tight global financial conditions and the high demand for the US Dollar in the international market. The Kenya Shilling to the US Dollar exchanged at Ksh 119.4 in August 2022 compared to Ksh 109.2 in August 2021. Over the same period, the Kenyan Shilling strengthened against other major international currencies. The Euro exchanged at Ksh 121.0 in August 2022 compared to Ksh. 128.6 in August 2021 while the Sterling Pound exchanged at Ksh 143.5 compared to Ksh 150.9 over the same period. In comparison to most Sub-Saharan Africa currencies, the Kenya Shilling has remained relatively stable weakening by 9.3 percent against the US Dollar in the year to August 2022. The stability in the Kenya Shilling was supported by increased remittances, adequate foreign exchange reserves and improved exports. 3.3 Money and Credit Broad money supply, M3, improved to a growth of 7.6 percent in the year to July 2022 compared to a growth of 6.9 percent in the year to July 2021. The pickup was mainly due to an increase in domestic credit particularly net lending to the private sector despite the decline in the Net Foreign Assets (NFA).Net Foreign Assets (NFA) of the banking system in the year to July 2022 contracted by 46.8 percent, compared to a contraction of 10.7 percent in the year to July 2021. The decline in NFA was partly due to the Central Bank payments of Government external obligations, and increased banks’ borrowings from foreign sources and reduction in foreign deposit assets to support lending to customers. Net Domestic Assets (NDA) registered a growth of 19.5 percent in the year to July 2022, an improvement compared to a growth of 11.7 percent over a similar period in 2021. The growth in NDA was supported by net lending to Government, and resilient growth in credit to the private sector as business activities improved. Other public sector lending improved to a growth of 0.1 percent in the year to July 2022 from a contraction of 6.5 percent in a similar period in 2021, mainly reflecting borrowings by county governments and parastatals 14 3.4 Private Sector Credit Private sector credit improved to a growth of 14.2 percent in the 12 months to July 2022 compared to a growth of 6.1 percent in the year to July 2021. All economic sectors registered positive growth rates reflecting improved demand as economic activities picked up. Strong credit growth was observed in the following sectors: transport and communication, business services, manufacturing, trade, building and construction and agriculture. The Credit Guarantee Scheme for the vulnerable Micro, Small and Medium Enterprises (MSMEs), continues to de-risk lending by commercial banks hence remains critical to increasing credit flow to the private sector. 3.5 External Sector Developments The overall balance of payments position improved to a surplus of USD 1,790.4 million (1.6 percent of GDP) in July 2022 from a surplus of USD 119.4 million (0.1 percent of GDP) in July 2021. This was mainly due to an improvement in the capital and financial account and increased receipts in net services and net secondary income despite a decline in the merchandise account and net primary income. The current account deficit was at USD 5,876.6 million (5.2 percent of GDP) in July 2022 compared to USD 5,494.7 million (4.9 percent of GDP) in July 2021. The current account balance was supported by an improvement in the net receipts on the services account and the net secondary income balance despite a deterioration in the net primary income balance and merchandise account. 3.6 Foreign Exchange Reserves The banking system’s foreign exchange holdings remained strong at USD 12,222.5 million in July 2022 from USD 14,196.3 million in July 2021. The official foreign exchange reserves held by the Central Bank stood at USD 8,267.8 million (4.7 months of import cover) in July 2022 compared to USD 9,651.7 million (5.9 months of import cover) in July 2021.The official reserves fulfil the requirement to maintain it at minimum of 4.0 months of imports cover to provide adequate buffer against short term shocks in the foreign exchange market. Commercial banks holdings decreased to USD 3,954.6 million in July 2022 from USD 4,544.6 million in July 2021. Activity in the capital markets slowed down in August 2022 due to the outflow of investors as advanced economies tightened their monetary policy amid recession fears. The NSE 20 Share Index declined to 1,751 points in August 2022 compared to 2,020 points in August 15 2021 while Market capitalization also declined to Ksh 2,142 billion from Ksh 2,841 billion over the same period 3.7 Fiscal Policy Outlook The Fiscal policy over the medium-term aims at enhancing revenue mobilization, expenditure rationalization and strengthening management of pending bills. This is geared towards economic recovery to support sustained, rapid and inclusive economic growth, safeguard livelihoods and continue the fiscal consolidation programme to create fiscal space for the implementation of the “Big Four” Agenda. 3.8 Risks to the Domestic Economic Outlook This macroeconomic outlook is not without risks from both external and domestic sources. On the external front, the key downside risks include: uncertainty about the global outlook, reflecting adverse effects of the war in Ukraine, inflationary risks (from rising prices of food and oil), continuing COVID-19 pandemic related disruptions, and supply chain constraints as well as increased global financial markets volatility amid the tightening of monetary policy in advanced economies. On the domestic front, the emergence of new Omicron COVID-19 variants may occasion restrictive measures. Other risks relate to lower agricultural output due to potential adverse weather conditions. Additionally, increased public expenditure pressures, particularly wage and other recurrent expenditures, would put a strain to the fiscal space. At the county level, the risks include; weakening of national economic growth, unfavourable weather conditions, delayed release of funds from the national treasury, threats of conflicts between the Pokot, Elgeyo/Marakwet and Turkana counties.Natural calamities may also pose a risk to the county’s development agenda and revenue collection. The most common disaster risks include disease outbreaks for both livestlock and human, conflicts, landslides,lightning strikes, flash floods and drought. These calamities can delay programs or lead to collapse of projects.In the event the above risks materialize the county revenue framework and the medium term sector ceilings shall be revised in the 2022 County Fiscal Strategy Paper. In the meantime, the county government continues to monitor the risks and will undertake appropriate measures to contribute to national macroeconomic stability. 16 IV. MTEF RESOURCE ALLOCATION FRAMEWORK 4.1 Revenue Outlook The resources available to be shared by the National and County Governments are estimated on the basis of projections of the economy’s performance. Growth is expected to remain resilient growing by 5.8 percent in FY 2022/23 and averaging 6.2 percent over the medium term. The FY 2023/24 and the Medium Term Budget framework builds up on the Government’s efforts to stimulate and sustain economic activity, mitigate the adverse impact of COVID-19 pandemic on the economy and re-position the economy on a sustainable and inclusive growth trajectory. This will be achieved through implementation of programmes in the Economic Recovery Strategy, priority programmes outlined in the Fourth Medium Term Plan (MTP IV) of the Vision 2030 and the County Integrated Development Plan (2023-2027). 4.2 Fiscal Projections for FY 2023/2024- 2025/2026 MTEF Period Table 9: Fiscal Projections for FY 2023/2024- 2025/2026 MTEF Period FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 PROJECTED REVENUE Projected Projected (Kshs) Projected (Kshs) Projected (Kshs) (Kshs) 1. National Revenue a.) Equitable share 6,297,284,329.00 6,347,284,329 6,397,284,329.00 6,397,284,329.00 b.) Conditional allocation (National Government - - - - Revenue) c.) External Grants/Loans 530,800,062.00 177,226,042.00 177,226,042.00 177,226,042.00 2. Own Revenue Sources d.) Projected Revenue From 170,000,000.00 170,000,000.00 175,331,349.00 178,331,349.00 Local Sources 6,998,084,391.00 6,694,510,371.00 6,749,841,720.00 6,752,841,720 Total Source: County Annual Development Plan for FY 2023/24 The table above provides estimates of revenue projection for the FY 2023/2024 - FY 2025/2026. The overall total projected revenue is estimated at Kshs. 6,694,510,371.00 Equitable share is expected to rise marginally from Ksh 6.297 billion in FY 2022/23 to Ksh. 6.347 billion in the FY 2023/24 and 6.397 billion over the medium term. Conditional allocation from external grants from development partners is projected at Ksh. 177,226,042.00 constituting 2.64 per cent of the total projected revenue. This comprise of projected conditional allocation of Ksh. 10,927,742.00 for Agriculture Sector Development Support Programme II, Ksh.10,538,600.00 for DANIDA, Ksh. 30,759,700.00 for Emergency 17 Locust Response Project and Ksh 125 million for Financing Locally-Led Climate Action Programme. The FY 2023/24 local revenue target is projected at Kshs. 170,000,000.00 representing 2.54 per cent of the total projected revenue. This comprises of net local revenue target of Ksh. 95,552,202 and Appropriations in Aid (F.I.F) for health amounting to Ksh. 72.8 million. 4.2.1 Internal Revenue Streams’ Projections for FY 2022/23-FY 2025/26 Table 10: Internal Revenue Projections by Stream Targets Revenue Source Actual Revenue Projected Estimates Projection FY 2021/22 2022/23 2023/24 2024/25 2025/26 Kiosk Rent 1,810,382.00 1,810,382.00 1,810,382.00 1,810,382.00 Single Business Permit 7,583,990.00 19,000,000.00 19,000,000.00 20,521,844.00 20,600,000.00 Market Fee 1,284,187.00 4,000,000.00 2,000,000.00 2,419,174.00 2,500,000.00 Building Approvals 451,116.00 2,451,116.00 2,500,473.00 2,420,000.00 Cess 24,021,393.00 6,260,345.00 6,260,345.00 6,785,300.00 6,800,000.00 Royalties 31,109,653.00 31,109,653.00 33,004,741.00 34,000,000.00 Stock Cess/slaughter 7,000,000.00 7,200,000.00 7,397,337.00 7,578,903.00 House Rent 2,913,867.00 2,083,664.00 2,083,664.00 2,170,436.00 2,500,000.00 Advertising 1,157,292.00 857,487.00 1,160,000.00 1,170,000.00 1,200,000.00 Parking Fee 3,320,178.00 1,308,132.00 1,308,132.00 1,582,734.00 1,678,000.00 Bus Park and 5,950,000.00 5,950,000.00 6,050,278.00 6,100,000.00 Motorcycle Renewals/Applications 1,704,410.00 1,704,410.00 1,807,778.00 1,950,900.00 Liquor Licensing 500,000.00 500,000.00 510,000.00 700,000.00 Agriculture 919,861.00 919,861.00 920,421.00 1,300,000.00 Other fees and charges 2,033,362.00 2,255,431.00 2,545,431.00 2,600,000.00 2,658,266.00 (public toilet, honey, hides & skin, firewood, tarmarind aloevera, fish, scrapmetal, penalties,) Lands(Plot/Land Rates) 5,630,937.00 9,838,819.00 9,938,819.00 10,000,147.00 10,000,200.00 Livestock/Permits 700,700.00 700,700.00 775,304.00 785,450.00 Appropriation in 64,020,327.00 72,800,000.00 72,800,000.00 72,805,000.00 73,100,000.00 Aid(FIF-Health) Receipt from admin. 1,415,719.00 50,000.00 60,000.00 fees and charges Public Health Facilities - - Fee Forest Products Fees 1,400,000.00 497,487.00 500,000.00 649,248.00 Grand Totals 113,381,252.00 170,000,000.00 170,000,000.00 175,331,349.00 178,331,349.00 Source: County Treasury, 2022 18 The FY 2023/2024 local revenue target is projected at Kshs. 170,000,000.00 representing 2.54 per cent of the total projected revenue. This comprises of net local revenue target of Ksh. 97.2 million and Appropriations in Aid (F.I.F) for Health amounting to Ksh. 72.8 million. This projection is modest in maintaining a reasonable degree of predictability with respect to the level of tax rates and tax bases.This growth projection represents a nil percent increase from the current target. The revised target will be achieved through the widening of tax bases, sealing of existing revenue leakages, strengthening of organizational structures and systems in revenue section, strengthening monitoring and evaluation of the revenue systems, and enhanced transparency, accountability and supervision in revenue collection. 4.2.2 Projected Medium Term Revenue & Expenditure Framework Table 11: Expenditure Forecast for FY 2023/24-FY 2025/26 Item FY2022/23 % FY 2023/24 % FY 2024/25 % FY 2025/26 % (Ksh) (Ksh) (Ksh) (Ksh) Approved Budget Projection Projection Projection Recurrent 4,891,972,929 65.4 4,686,157,260 70 4,724,889,204 70 4,726,989,204 70 Development 2,592,662,673 34.6 2,008,353,111 30 2,024,952,516 30 2,025,852,516 30 Projected Gross 7,484,635,602 100 6,694,510,371 100 6,749,841,720 100 6,752,841,720 100 Expenditure Projected Personnel 2,708,005,957 36.2 2,343,078629 35 2,362,444,602 35 2,363,494,602 35 Emoluments to Gross Estimates Table 12 provides indicative tentative ceilings for the different county departments for FY 2023/24 - FY 2025/26 MTEF period. 4.3 Expenditure Priorities for FY 2023/2024 –FY 2025/26 MTEF Period The County Integrated Development Plan (2023-2027) and the Medium Term Plan IV of Kenya Vision 2030 are the key policy documents that will guide the county government spending decisions. The Vision 2030 provides the overarching long term national development agenda, while the CIDP sets out the county medium term development plan. 19 Tentative Sectoral Ceilings Table 12: FY 2022/23- FY 2023/24 MTEF CEILINGS CFSP, 2022 CEILINGS CBROP, 2022 TENTATIVE CEILING VOTE RECURRENT DEVELOPMENT TOTAL BUDGET RECURRENT DEVELOPMENT TOTAL BUDGET % ESTIMATES ESTIMATES CEILINGS FY ESTIMATES ESTIMATES PROJECTIONS FY 2022/2023 2023/2024 COUNTY EXECUTIVE 423,059,268.00 92,300,000.00 515,359,268.00 415,860,860.00 100,000,000.00 515,860,860.00 7.71% FINANCE AND ECONOMIC PLANNING 241,279,887.00 3,600,000.00 244,879,887.00 284,993,150.00 20,000,000.00 304,993,150.00 4.56% PUBLIC WORKS,TRANSPORT AND 84,705,521.00 261,550,000.00 346,255,521.00 91,705,521.00 250,000,000.00 341,705,521.00 5.10% INFRASTRACTURE HEALTH , SANITATION AND EMERGENCY 1,663,750,446.00 200,746,325.00 1,864,496,771.00 1,659,722,541.00 100,000,000.00 1,759,722,541.00 26.29% SERVICES EDUCATION AND TECHNICAL TRAINING 915,663,435.00 194,950,000.00 1,110,613,435.00 874,523,083.00 120,000,000.00 994,523,083.00 14.86% AGRICULTURE AND IRRIGATION 100,174,450.00 423,654,000.00 523,828,450.00 99,474,450.00 60,000,000.00 159,474,450.00 2.38% PASTORAL ECONOMY 103,986,053.00 147,860,513.00 251,846,566.00 102,186,053.00 100,000,000.00 202,186,053.00 3.02% TRADE, INDUSTRALISATION AND 90,938,737.00 272,800,000.00 363,738,737.00 87,986,737.00 6,000,000.00 93,986,737.00 1.40% COOPERATIVE DEVELOPMENT LANDS, HOUSING,PHYSICAL PLANNING 111,131,522.00 32,800,000.00 143,931,522.00 116,831,522.00 74,800,000.00 191,631,522.00 2.86% AND URBAN DEVELOPMENT WATER , ENVIRONMENT AND NATURAL 83,190,993.00 226,600,000.00 309,790,993.00 83,190,993.00 80,000,000.00 163,190,993.00 2.44% RESOURCES YOUTHS, SPORTS, TOURISM, GENDER AND 74,598,180.00 21,600,000.00 96,198,180.00 96,725,904.00 50,000,000.00 146,725,904.00 2.19% SOCIAL SERVICES. WEST POKOT COUNTY ASSEMBLY 682,707,541.00 100,000,000.00 782,707,541.00 674,044,748.00 128,931,017.00 802,975,765.00 11.99% PUBLIC SERVICE, ICT AND 245,034,675.00 95,000,000.00 340,034,675.00 266,487,241.00 - 266,487,241.00 3.98% DECENTRALIZED UNITS SPECIAL PROGRAMMES AND 45,880,126.00 45,880,126.00 51,046,551.00 51,046,551.00 0.76% DIRECTORATES WARD SPECIFIC PROJECTS - 700,000,000.00 700,000,000.00 10.5% TOTAL 4,866,100,834.00 2,073,460,838.00 6,939,561,672.00 4,904,779,354.00 1,789,731,017.00 6,694,510,371.00 100.0% 20 V. CONCLUSION In summary, the County Budget Review & Outlook Paper has provided an analysis of the actual fiscal performance in the FY 2021/22 compared to the budget appropriation for the year and the updated economic and financial forecasts. The fiscal responsibility principles and the financial objectives for the year under review were met.in addition, the tentative ceilings for the FY 2023/2024 have also been provided. Going forward, the ceilings are expected to be taken into account while setting the final ceilings in the County Fiscal Strategy Paper. 21 Annex 1: Budget Calendar Table 13: Budget Calendar WEST POKOT COUNTY BUDGET CALENDAR FOR THE FY 2023/2024 ACTIVITY RESPONSIBILITY TIME FRAME 1 Budget Performance Review 1.1 Prepare and Issue County Treasury CECM Finance 30th August 2022 Circular &Economic Planning 1.2 Drafting of CBROP CECM Finance 1st September -23rd &Economic Planning September 2022 1.2 Submission of Draft CBROP to County CECM Finance & 27th September 2022 Executive Committee Economic Planning 1.3 Submission of Approved CBROP to CECM Finance & 13th October 2022 County Assembly for approval Economic Planning 2 Strategic Planning 2.1 Preparation of Annual Development Plan CECM Finance & 2nd August -29th August for FY 2023/2024 Economic Planning 2022 2.2 Submission of Annual Development Plan CECM Finance & 31st August 2022 for FY 2023/2024 to County Executive Economic Planning Committee 2.3 Submission of Annual Development Plan CECM Finance & 1st September 2022 for FY 2022/2023 to County Assembly for Economic Planning approval 3 Review of MTEF Budget Proposals: 3.1 Review and Estimation of Resource Macro-Working Group 22nd August 2022 Envelope and Determination of Policy Priorities 3.2 Preparation of 2023/2024 County Wage Head of Human Resources 7th -11th November 2022 Bill & Head of Budget 3.3 Convene Sector Working Group Meetings Chief Officers & Head of 7th December 2022– 5th and Preparation of Sector Reports and Planning, Directors January 2023 Draft Budget Estimates 3.4 Sector Hearing on Sector Budget Chief Officers, County 1st – 7th February 2023 proposals Assembly Clerk County Assembly Sectoral Committee Chairs 4 County Fiscal Strategy Paper and County Debt Management Strategy Paper 4.1 Release of 2023/2024 Budget Policy National Treasury 15th February 2023 22 statement 4.2 Draft County Fiscal Strategy Paper and Head of Budget & Head of 1st – 17th February 2023 County Debt Management Strategy Paper Planning 4.3 Submission of Draft CFSP and CDMSP to CECM Finance & 22nd February 2023 County Executive for approval Economic Planning 4.4 Submission of CFSP to County Assembly CECM Finance & 25th February 2023 for Approval Economic Planning 4.5 Submission of County Debt Management CEC Finance & Economic 28th February 2023 Strategy Paper to County Assembly Planning 4.6 Adoption of County Fiscal Strategy Paper County Assembly Budget 14th March 2023 & Appropriation Committee 5 County Public Participation 5.1 Joint Meeting MCAs, Sub County & Ward Head of Budget & 12th _16th December 2023 Administrators for Participatory Chairman Budget Budgeting Training and Preparation of Appropriation Committee Public Participation Schedule & Venues 5.2 Publicize Public Participation Schedule Head of Budget & Ward 4th -8th January 2023 Administrators 5.3 Ward Level Public Participation - All 20 Head of Budget, Head of 11th January – 20th Wards Planning & Ward January 2023 Administrators 6 Preparation and Approval of Final Departmental Programme Budgets 6.1 Preparation of Draft Budget Estimates by Departmental Heads 2nd March – 24th March departments &Technical Staff 2023 6.2 Submission of Draft Budget Estimates to Departments & Head of 27th March 2023 Budget office Budget 6.3 Consolidate & Review of Draft Budget Head of Budget 3rd – 7th April 2023 Proposals 6.4 Submission of Consolidated Draft Budget CECM Finance & Economic 18th April 2023 Estimates to County Executive Planning 6.5 Submission of Budget Estimates to CECM Finance & Economic 27th April 2023 County Assembly Planning 6.6 Submission of Finance Bill to County CECM Finance & Economic 27th April 2023 Assembly Planning 6.7 Report on Budget Estimates from County County Assembly Budget & 25th May 2023 Assembly Appropriation Committee 6.8 Consideration of Final Budget Estimates CEC Finance & Economic 8th June 2023 Planning 23 6.9 Submission of Annual Cash Flow Head of Accounting & 14th June 2023 Principal Finance Officer 7 Consideration of Passage of Appropriation Bill 7.1 Approval of Final Budget Estimates County Assembly 22nd June 2023 7.2 Submission of Appropriation Bill to CEC Finance & Economic 29th June 2023 Assembly Planning 7.3 Passage of Appropriation Bill County Assembly 29th June 2023 7.4 Passage of Finance Bill County Assembly 29th June 2023 24