Statement by Okoa Uchumi Coalition in Response to the Government of Kenya Consideration to Join the Debt Relief (G20 DSSI) Initiative

Picture credit: Fiona Graham / WorldRemit

The Okoa Uchumi Debt Campaign is a civil society platform committed towards working with stakeholders to redress Kenya’s public debt crisis. The coalition seeks to push for political accountability and bolster constitutional safeguards in public debt management as a means to debt sustainability through a balanced and equitable budget. (FN1)

We welcome Kenya’s decision to seek debt relief under the G20 debt service suspension initiative. The debt service suspension initiative (DSSI) is a facility set up by multilateral lenders (WBG, IMF and others) to help poor countries deal with the impacts of the COVID-19 pandemic, to safeguard the lives and livelihoods of millions of the most vulnerable people. Aside from offering public debt relief, the facility seeks to instill robust transparency principles into public debt management in Kenya.

However, this move needs to be accompanied by measures to curb non-essential spending and ensure transparency in public debt management. In this regard we make the following call:

  • We call upon the National Treasury to prioritize the protection of health workers on the frontline and the 1.8 million who have lost their livelihoods on account of the Covid-19 pandemic.
  • We call upon government to expedite the publishing of the Covid-19 Economic Recovery Strategy to promote accountability and coherence in its Covid-19 response.
  • We call upon the National Treasury, the IMF and World Bank to ensure that upcoming and emergency funding for Kenya is not spent repaying existing debts but rather on investing in social needs and boosting equitable growth in the medium-term.
  • We call upon the National Treasury to work with realistic economic scenarios that do not place an additional tax burden on Kenyans. For instance, we do not agree with the minimum tax (Section 12D of Income Tax (Cap 470) that will be effective from 1st January 2021.
  • We call upon the National Treasury to ensure enhanced transparency including public disclosure of all new public debt contracts.
  • We call for the National Treasury to update the 2020 Medium-Term Debt Strategy to respond to the impacts of Covid-19.
  • We also call upon the Treasury to comply fully with the recommendations of the National Assembly Budget and Appropriations Committee from earlier in the year to increase debt transparency by clearly indicating the amount of concessional, semi concessional and commercial loans, clearly outlining the country’s updated borrowing strategy and providing the list of specific projects that will benefit from these funds, and updating the public debt register.
  • We call upon the National Treasury to comply with PFM reporting requirements and publish the quarterly expenditure report of the Covid-19 emergency response funds.
  • Lastly, we call upon the National Treasury to hold a consultative meeting with the public to build accountability in public debt management.

For More Information Contact: Christine (0713 639 407)

FN1: Okoa Uchumi Coalition Members: Crawn Trust Kenya, Diakonia Sweden, Institute for Public Finance Kenya, International Budget Partnership Kenya, Interreligious Council Kenya, Kenya Human Rights Commission, National Taxpayers Association Kenya, Okoa Mombasa, Oxfam Kenya, PAWA 254, The Institute for Social Accountability, Transparency International Kenya, Youth Agenda, Katiba Institute, East Africa Tax Justice Network

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