Treasury continued to run an overdraft at the Central Bank of Kenya (CBK) for the fifth consecutive month in November, indicating difficult times for the government due to slow revenue collection.

As at the end of the month, the State had over-drawn Sh25.4 billion from its account with the CBK, which is the highest amount it is allowed to draw as per the 2012-13 financial year limit set by law.

Treasury data shows the government was running a funding deficit of as much as Sh49.4 billion as at the end of first quarter of the financial year ended September 30.

The pressure on the Treasury’s finances was reflected at the end of the first quarter’s financial report which showed tax collection alone was behind target by Sh31.7 billion, ministerial collections (appropriations-in-aid) were below target by Sh13.5 billion while grants from international donors failed to meet the mark by Sh4.2 billion.

The overdraft is supposed to be repaid by the end of each financial year, but occasions have arisen when the government has failed to settle, leading to an overdrawn account.

Domestic borrowing through Treasury bills and bonds has been slow as the government has sometimes rejected bids at the auctions as a way to ensure interest rates do not rise at a time when the Central Bank is keen on keeping them low to power the soft economic growth.