Ideas & Debate

Cutting public funds wastage

Parliament in session. FILE PHOTO | NMG
Parliament in session. FILE PHOTO | NMG 

The recent Devolution conference in Kakamega just like the last four, grossly failed to address the elephant in the room: Restructuring, reordering and realigning national government ministries, departments and agencies (MDAs) to accord with and respect devolution, incomplete transition, and unbundling and costing functions.

The Constitution of Kenya, 2010 sought to address socio-economic challenges in a number of ways. Elaborate measures are provided for to ensure that national resources and development are equitably managed. The Constitution also provides for affirmative action to redress past socio-economic exclusion. With regard to land management, the Constitution provides a broad framework for the management of land and land-based resources.

Devolution of power and resources was seen as a means of promoting and advancing democracy, participation and accountability. It would further enhance development, efficient and effective service delivery. It would also entrench equity and inclusiveness in development and access to services. Lastly, devolution was perceived as a means of enhancing the concept of good governance by incorporating vertical separation of powers and increasing the ambit of checks and balances.

The Constitution puts in place several measures to ensure prudence, fiscal discipline and accountability at both national and county level. This was a response mechanism to the demands of Kenyans to ensure that public resources are used prudently, efficiently and effectively to deliver services. The primary source of revenue for the National and County Governments is taxation.  The revenue raised nationally is shared equitably between National and County Governments with the equitable share for every financial year for County Governments being not less than 15% of the last approved audited accounts. Article 202 provides that County Governments may receive additional allocations either conditionally or unconditionally. Article 204 establishes an Equalization Fund which is 0.5% of total revenues raised annually to provide basic services to marginalized areas to bring them to a level enjoyed by other parts of the Nation. 

Article 209(3) authorizes counties to collect property taxes, entertainment taxes and any other taxes authorized by an Act of Parliament, except the taxes that are collectable by National Government by virtue of Article 209(1). County Governments may also impose charges on services they provide. The sources of revenue for the County Governments are thus equitable shares of revenues raised nationally; own revenue collection; and borrowing which must be guaranteed by the National Government.

While the Constitution and the Transition to devolved government law envisaged a gradual/ phased transfer of functions to counties based on an assessment of readiness of counties a decision was made in the first meeting of the National and County Coordination Summit to do away with the assessment of readiness of counties and instead adopt a “big bang” approach that will see powers transferred to counties.

According to media reports, County Governments were of the view that citizens expected their counties to start offering much needed public services and a phased/ gradual transfer of functions would hinder counties from delivering promises to their electorate. Furthermore, it was felt that transferring functions and resources asymmetrically may actually perpetuate the very inequalities that the devolved system is meant to address since most of the poorer counties would not meet the criteria for immediate transfer.

Consequently, a political settlement within the ambit of the Inter-Governmental Relations Act was arrived at in which the transfer of all functions under the Sixth Schedule was affected. The budgeting process should, as a priority, secure capacity building structures of both the national and county governments.  A major component of the capacity building should be on how to develop and maintain intergovernmental relation structures that would facilitate consultation and cooperation.

Furthermore, capacity building efforts should be long term and focused on professional and skill development as opposed to ad hoc trainings. Capacity building should also be linked with the rationalization of staff at the national and county levels. The frameworks and policies for capacity building should be developed in consultation with county governments as this will ensure a proper identification of capacity gaps.