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Nairobi , December 13, 2011

Cabinet media brief

The Cabinet today reviewed the flood situation in the country. Meeting under the Chairmanship of His Excellency President Mwai Kibaki at State House Nairobi, the Cabinet directed that the Cabinet committee on disaster management should ensure that all necessary measures are put in place to ease the suffering of those affected.

The Cabinet committee was scheduled to meet this afternoon under the Chairmanship of the Rt. Hon Prime Minister Raila Odinga.

Today's meeting also reviewed the salary requests by various public sector employees. The Cabinet reviewed the requests in the context of current budgetary constraints facing the country and ordered that such requests should be directed to the Salaries Remuneration Commission, in order to ensure harmony and sustainability of the Government and parastatals wage bill.

The Cabinet noted that composition of the Salaries Review Commission should be completed in the next two weeks. In this regard the Cabinet said that individual ministries will now act as facilitators of submissions to the Salaries and Remuneration Commission.

Under the Constitution, the Salaries and Remuneration Commission is supposed to ensure that the total public compensation Bill is fiscally sustainable.

The Cabinet also reviewed implementation of the current budget in view of the significantly changed economic environment.

In this regard the Cabinet decided to effect expenditure cuts targeting:
1. Official travel.
2. Procurement of Government vehicles and office furniture.
3. Hospitality.
4. Printing and advertising.
5. Other low-priority Government expenditures.

Today's meeting also authorized the borrowing by Treasury of a short- term loan amounting to U.S. $ 600 Million from external markets to support infrastructure financing.

Cabinet also noted that the International Monetary Fund ( I.M.F.) had approved an Extended Credit Facility (E.C.F.) of U.S. $ 760 million under a three year arrangement. The board's decision enabled the immediate disbursement of $ 143 million, bringing total disbursements under the ECF to an amount equivalent to $ 312 million.