Finance and Economic Planning > CFSP > 2014-15 FY CFSP > INTRODUCTION > Fiscal responsibility management (section 107)

In line with the Constitution, the Public Financial Management (PFM) Act, 2012, sets out fiscal responsibility principles to ensure prudency and transparency in the management of public resources. The PFM law (Section 15) states that:

(1)Over the medium term, a minimum of 30% of the county budget shall be allocated to development expenditure

(2)The county government’s expenditure on wages and benefits for public officers shall not exceed a percentage of the county government’s revenue as prescribed by the regulations

(3)Over the medium term, the county government’s borrowings shall be used only for the purpose of financing development expenditure and not for recurrent expenditure

(4)Public debt and obligations shatl be maintained ab a sesiainable level as approved by county assembly

(5)Fiscal risks shall be managed prudently

(6)A reasonable degree of predictability with respect to the level of tax rates and tax bases shall be maintained, taking into account any tax reforms that may be made in the future