Tourism ministry unlikely to meet its revenue target - PS - Beaking Kenya News

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Thursday, 23 July 2020

Tourism ministry unlikely to meet its revenue target - PS

Tourism PS Safina Kwekwe during a past function.

The Tourism ministry is unlikely to raise its Sh7.2 billion share of the 2020/2021 budget appropriation- in-aid (A-I-A), the principal secretary told a parliamentary committee on Wednesday.

This is the income that a government ministry or department is expected to raise through various services. It is allowed to retain and use the funds without surrendering it to the consolidated fund.

Safina Kwekwe said a huge chunk of the ministry’s budget is dependent on internally generated funds, and with the sector still reeling from effects of Covid-19, it might not meet its target.

She said the deficit could largely affect the ministry's Sh8.49 recurrent expenditure budget for the current financial year.

The National Treasury has allocated Sh12.8 billion for the tourism sector.

Out of this, Sh4.3 billion is for development with Sh8.49 for recurrent expenditure. Appropriation-in-Aid (A-I-A) under recurrent spending targets is set at Sh7.2 billion.

“We might not be able to raise the A-I-A mainly by the SAGAs (Semi-Autonomous Government Agencies (SAGAs),” PS Kwekwe told the Standing Committee on Tourism, Trade and Industrialisation, chaired by Wajir senator Abdullahi Ali.

She spoke during a zoom meeting to update the committee on the state of the tourism sector during the Covid-19 pandemic.

According to the PS, the budget process began before the Covid-19 pandemic hence considerations were not included in coming up with the targets.

She however said the ministry is keen to take the country’s tourism sector to the next level, by leveraging on technology and selling destination Kenya as an experience rather than focusing on products.

“We don’t want to sell facilities, we are selling attraction and experience,” she said.

The ministry is urging tourism stakeholders to re-package products and make them attractive for locals hoping that domestic tourism can help the sector recover from the effects of Covid-19 pandemic.

“The pricing systems kind of puts off our people because they are too high. We need to re-package products to attract the domestic market,” Chief Administrative Secretary Joseph Boinnet said.

The sector is one of the most hit according to the Kenya Private Sector Alliance data, which shows more than 5.9 million jobs have been affected since the first case of Covid-19 was reported in the country in March.

Of these, 3.1 million jobs are in the travel and tourism with jobs in hotels, pubs and restaurants, tour operators, airlines, travel agents and their related suppliers and support services affected.

The ministry is working on a framework to disburse funds set to cushion the sector which includes Sh3 billion set aside by Treasury to support renovation of facilities and the restructuring of business operations by actors in the industry.

Ali called for transparency in all funds set aside to support the recovery of the sector.

“In Kenya, where money is involved, we tend to have corruption issues. We hope there will be transparency and everything done in a very transparent manner,” he said.

Senator Agnes Zani called on strict adherence to travel protocols; including ensuring travel history for incoming visitors.

To support recovery of the sector, the government has initiated a number of urgent measures including a temporary lifting of ban to hold meetings in private hotels by government agencies.

The government has also waived landing and parking fees at airports in order to facilitate the movement of cargo, in and out of Kenya.

“The government will scale up efforts to boost the tourism sector by promoting aggressive post Covid-19 tourism marketing and providing support for hotel refurbishment through soft loans,” National Treasury CS Ukur Yatani said during his budget speech.

He set aside Sh2.5 billion for the Tourism Promotion Fund and Sh3.8 billion for the Tourism Fund.

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