Kenya’s Ruto proposes spending cuts after nationwide protests

Kenyan President William Ruto on Friday proposed spending cuts and additional borrowing in roughly equal measure to fill a nearly $2.7 billion budget hole caused by his withdrawal of planned tax hikes in the face of nationwide protests.

Ruto scrapped thefinance billcontaining the tax increases in response to mass,youth-led demonstrationsthat have created the biggest crisis of his two-year-old presidency.

At least 39 people were killed in clashes with the police and some demonstrators briefly stormed parliament last week.

Ruto said in a televised address that he would ask parliament for spending cuts totalling Ksh177 billion ($1.39 billion for the fiscal year that began this month and that the government would increase borrowing by about Ksh169 billion ($1.32 billion.

The president has been caught between the demands of lenders such as the International Monetary Fund to cut deficits, and a hard-pressed population reeling from rising living costs.

Analysts have said the bill’s withdrawal is likely to result in Kenyamissing targetsin its IMF programme, although the government does not have debts coming due for which it urgently needs cash.

Kenya’s budget deficit is now projected at 4.6 percent of gross domestic product in the 2024/25 financial year, up from an earlier estimate of 3.3 percent, Ruto said.

Austerity measures will include the dissolution of 47 state corporations, a 50 percent reduction in the number of government advisers, the suspension of non-essential travel by public office bearers and the removal of budget lines for the president and deputy president’s spouses, he said.

“I believe these changes will set out our country on a trajectory towards economic transformation,” Ruto said.

He also announced a forensic audit of the country’s debt, which sits at more than 70 percent of gross domestic product, and said he would announce changes to the government soon.

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Following the speech, Ruto hosted a live audio forum on X meant to engage with young people. He faced sharp questioning about policy brutality, corruption and economic policy.

One activist involved in the protests, Osama Otero, questioned Ruto aboutalleged abductionsof protesters by state security agents, saying he had been taken at 3 amby men in plain clothes, blindfolded and taken to a house to be questioned.

“MrPresident, are we in a terrorist country?” Otero asked.

Ruto, who had previously denied police involvement in dozens of reported disappearances, apologised for the treatment Otero had suffered and promised to take action on his case.

Protests have continued since Ruto scrapped the finance bill, with many demonstrators calling for the president to resign. But turnout has been down and some activists have called for arethink of their strategyafter Tuesday’s demonstrations were marred by violence and looting.

Activists have blamed the violence on thugs hired by politicians to discredit the protest movement. The government has said that opportunistic criminals are responsible.

Here is a summary of new proposed austerity measures:

• 47 State corporations with overlapping functions to be dissolved. Staff in affected agencies to be transferred to ministries and agencies.
• Chief Administrative Secretaries (CAS office suspended.
• Presidential advisors reduced by 50 percent with immediate effect.
• Budget for First Lady and spouses of Deputy President, and the Prime Cabinet Secretaryremoved.
• Confidential budget in State House, all offices removed.
• Renovations reduced by 50 percent.
• No extension past 60-year retirement for all civil servants.
• Purchase of vehicles suspended for 12 months, except for security agencies.
• All non-essential travel suspended.
• No state officer, public servants will participate in harambees.Attorney General to submit law to this effect on harambee, philanthropic and charitable ventures.
• Changes in government to be announced soon.