Editorials

Enforce austerity in the devolved governments

treasury

Treasury building. FILE PHOTO | NMG

In the eight years that Kenya has had devolved governments, there has been a constant breach of the legal cap on expenditure on salaries in counties.

The latest report by the Controller of Budget showing that remuneration expenditure as a percentage of the total revenue in counties rose to 41.7 percent in the year to June 2020 from 36.5 percent the previous year is therefore not a surprise.

Under the Public Finance Management Act, 2015 counties are only allowed to spend up to 35 percent of the total revenues in a fiscal year on salaries and allowances, but they have taken to spending more simply because no action has been taken to punish the breaches.

The counties have had enough time over the past eight years to implement proper structures that would ensure they don’t overspend on salaries.

The Treasury has been at the forefront of preaching austerity in recent months, as it takes stock of stretched public finances. It is therefore puzzling why it continues to turn a blind as counties breach their limit for salary expenditure, despite having available powers to punish those doing so.

Allocations to counties that are exceeding their set limit for salaries expenditure should be witheld to get them to accept that austerity measures are not only meant for the national government.

Part of the problem has been due to the politicisation of hiring, with jobs dished out as rewards to cronies. In light of the inflationary effect on county wage bills, the use of county jobs to reward political support must be stopped.

For the counties, these breaches also serve to weaken their position when negotiating for funds from the Treasury.

They will be hard pressed to justify the huge pending bills and inability to fund essential services such as healthcare, water and sanitation while continuing to spend lavishly on personal emoluments.

Governors must therefore start taking accountability and control over the wage bills of their counties, because as long as they are overspending on salaries while neglecting more essential expenditure, they continue to weaken their argument for increased funding to devolved governments.