Ruto Orders CEOs To Reduce Salaries & Budgets By 30 Per Cent

President William Ruto has ordered the Chief Executive Officers (CEOs) of parastatals in Kenya to reduce their approved budgets by 30 per cent.

This followed a meeting held at State House, Nairobi where the Head of State underscored the need for fiscal discipline when it comes to the use of public funds.

He noted that the budgets and expenditures of the parastatals should undergo a rigorous audit to rid cases of leakage of public resources unnecessarily.

President William Ruto speaking during a meeting with heads of parastatals at State House Nairobi on March 26, 2024. /PCS

"Our budgets and expenditures must be subjected to rigorous audits to eliminate abuse of public resources. We will leverage technology to maximise the value for money and boost service delivery.

"At State House Kenya, Nairobi County, met Parastatal Chairpersons and Chief Executive Officers; asked them to cut their approved budgets by 30 per cent," stated Ruto on his social media handles.

The Head of State also warned that the expenses must never exceed the budget set, stating that by using technology, the CEOs would optimum ways of running operations and maximising profits.

Recurrent budget refers to the budget for ongoing expenditures such as salaries, operations, maintenance and cost of capital assets.

The Head of State further directed commercial state corporations to remit 80% of their profits after tax to the National Treasury.

Regulatory institutions were also ordered to remit 90% of their surplus funds to the Treasury.

"The time is up for loss-making parastatals and those that make profits must stop wasteful expenditure, including financing largesse in their parent ministries and unnecessary procurement," Ruto stated. 

"Now that the economy has stabilised, we cannot continue accumulating debt. Borrowing will only lead us down the cliff."

The briefing also saw President Ruto discuss the sale of some institutions to the private sector to boost productivity, pointing out several entities which end up straining the national budget, citing cases of parastatals duplicating roles, leading to the wastage of taxpayers' resources.

“In three years, we must run a balanced budget. It won’t be easy but we must do it,” he explained.