Photo/FILE Finance Minister, Uhuru Kenyatta with the briefcase that held the 2009/10 Budget.
By LUCAS BARASA, lbarassa@nationmedia.com, and ALPHONCE SHIUNDU,ashiundu@ke.nationmedia.com
Posted Sunday, June 26 2011 at 22:50
Posted Sunday, June 26 2011 at 22:50
The Treasury has denied claims of a Sh251 billion error in the Budget.
Allegations by Mars Group were flawed, according to Finance ministry public relations officer Maina Kigaga.
“What Mars Group has done is to get the total income of Sh610,286,673,000 and net off the total (both recurrent and development) of Sh774,067,825,000 to obtain the purported operating deficit of Sh163,781,152,000.
The group added the budgeted operating surplus of Sh87,325,089,000 to get the purported error of Sh251 billion,” Mr Kigaga said.
On Wednesday, the Mars Group also informed the Parliamentary Accounts Committee of a repayment plan for a non-existent fertiliser factory in which an Austrian firm will get Sh1.2 billion in the next three financial years.
Mars Group bosses Mwalimu and Jayne Mati said the errors were part of the reason why the Treasury and the Executive were pushing MPs to approve the Budget under the old constitutional dispensation.
But in an advertisement in yesterday’s Sunday Nation, the Treasury said: “It should be noted that capital expenditures fund capital items that build the asset base of State corporations and generate value over a long period of time.
The correct accounting treatment is to expense them through a depreciation charge over the life of the asset. The assertion by the Mars Group is to say the least, simplistic.”
In a submission to the Budget Committee seen by Nation, Mars Group warned that violations of the Constitution would not be taken lightly.
“Parliament needs to know there are serious sanctions that come with violating the Constitution. Indeed, the effect of the action by Parliament will be challenged by way of judicial remedy,” warns the group.
The warning comes after the House Business Committee ignored a ruling by the Speaker and approved a motion allowing the government to access Sh368 billion from the Consolidated Fund.
MPs who sit in the Budget Committee say their efforts to alert temporary Deputy Speaker Ekwee Ethuro that the Sh368 billion approval was unconstitutional fell on deaf ears.
A member of the committee, Mr John Mbadi (Gwassi) said the Executive was not willing to let the House take the lead in budget-making.
“It is time the Executive is made to believe in this Constitution,” said the MP.
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