Kenyans cut their use of government services last year as the cost of applying for key documents including identification cards (IDs), passports and land searches surged.
Collections from the fees marked a rare decline in six months to December, despite the increased charges according to data from the latest quarterly economic and budget review report from the National Treasury.
Charges for services such as issuing IDs, passports, work permits, and marriage certificates have all soared in the last year as the government struggles for additional cash amid public uproar against new taxation measures.
The higher fees have nevertheless failed to yield additional revenues as the total non-tax collections, known as appropriations in aid, marked a rare drop in the opening half of the 2024/25 fiscal year to Sh210.9 billion in six months to December 2024 from Sh224.6 billion a year prior.
“Anytime you see a drop in appropriations in aid, it's one of two scenarios, one is that people are consuming less of paid for government services such as IDs, passports and land transfer transactions,” Dr Abraham Rugo, the executive director for the International Budget Partnership-Kenya, told this publication.
Ministerial appropriation in aid has been on a growth trend for at least the last five fiscal cycles including the pandemic year, making the current drop a rarity.
Higher fees on government services had been seen creating a windfall to the operations of Ministries and State departments, helping wean them off exchequer support.
The collections can come from revenue set aside by the National Treasury for a specific agency to use for its activities, donor grants or fees collected by the agency. This implies that a shortfall in the disbursement of grants could also impact the collections.
Receipts from external grants were however healthy in the six months to December 2024, growing by over two-fold to Sh14.7 billion from Sh5.4 billion previously.
The National Treasury has defended the move to raise fees paid for government services saying the realised revenues will ease the burden on taxpayers in funding the operations of key State departments and agencies.
“The government is exploring non-tax revenue measures to reduce MDAs’ dependence on exchequer revenues, ensuring that the appropriation-in-aid is sufficient to cover these expenditures without relying on the exchequer,” Treasury says in the 2025 Budget Policy Statement (BPS).
From January last year, the cost of a first-time ID application soared to Sh1,000 from zero previously while duplicates or replacements now attract a cost of Sh2,000 from Sh100 previously.
Passport charges meanwhile rose in November 2023 with the cost of obtaining an ordinary series A 34-page passport rising to Sh7,500 from Sh4,500 previously.
Alien cards, citizenship and resident applications costs also went up with foreign nationals residing in Kenya now obligated to pay Sh5,000 for an alien card effective from March 2024 from Sh1,000 previously.
Other agencies that have followed the Ministry of Interior in raising their respective service charges have included the Ministry of Lands, the Kenya Wildlife Service (KWS) and the National Museum.
The National Treasury has been targeting at least Sh55.8 billion from the higher administrative fees and charges in the 2024/25 financial year that runs to June from a previous estimate of Sh28.3 billion.
The exchequer expects ministerial appropriations in aid to hit Sh484.3 billion in the fiscal year to June 30 from an initial estimate of Sh426 billion.
The collections previously stood at Sh413.7 billion and Sh313.9 billion for the 12-months period to June 2023 and June 2022 respectively. The ministry collections are expected to hit Sh550.7 billion in the financial year starting July 1.
The appropriations are seen as crucial amid tax revenues underperformance with netting through six months to December 2024 falling off the mark by Sh93.2 billion totalling Sh1.15 trillion against expectations of Sh1.25 trillion.
