Infrastructure plans Kenyan towns require

Kenya’s rapid urbanisation coupled with incoherent urban policies and inadequate infrastructure has made towns vulnerable to population dynamics, climate change and poverty.

The outbreak of Covid-19 has shown how global shocks can further unearth the evils of decades of mismanagement of urban areas.

Ironically, but not surprisingly, slum residents and squatter settlements bear the brunt and this, in turn, exacerbating socio-spatial gaps in Kenyan urban areas.

Urban areas in Kenya are envisioned as engines of growth but they suffer from severe service and infrastructure shortages that expose the underbelly of infrastructure financing. The realisation of the full potential of urban areas, therefore, depends crucially on their ability in meeting the challenges of providing infrastructure sustainably.

In Kenya, the bulk of infrastructure provision lies with county governments and concerns have been raised on the capacities of local governments to sustainably finance infrastructure.

Devolution saw the transfer of responsibilities to county governments with the Public Finance Management Act (PFMA) stipulating that the regional governments set aside 30 percent of budget to development expenditure.

Accordingly, formulation of County Infrastructure Master Plans (IMP) and Urban Utilities provides a high level direction in the provision of the urban utility services, including transportation networks and water supply. Therefore, the achievement of an efficient and effective system of providing infrastructure in counties is a necessary condition for achieving the development objectives of the County and Vision 2030.

ENHANCING CAPACITY

Nevertheless, experiences over the past 10 years reveal that county own-source revenues are insufficient to meet the growing infrastructure.

The reliance on property rates and development fees has also proven unsustainable as most counties collect less than 20 percent of their projections and expected capacities.

A critical contributor to sustainable infrastructure financing in county governments are the development fees.

Given the inadequacies of the county governments’ financial resources and capacities, there is a need for an integrated policy and regulation in which urban bodies can enhance capacity to generate resources from existing sources and use innovative sources of infrastructure financing.

The promulgation of the 2010 Constitution created a paradigm shift in the financing of urban infrastructure. Earlier, infrastructure financing relied primarily on central government through budgetary allocations, grants and foreign aid among others.

The new paradigm uses both national and county government funding to lift investments from within and outside the local jurisdictions to create a broader mixed financing option for urban infrastructure.

Therefore, to create a “healthy” urban infrastructure financing climate, county governments need sound and transparent financial management practices and demonstrate the creditworthiness of proposed projects.

SMALL PROJECTS

Financial markets as well as donor agencies require accurate and timely information about the risk of investing in urban infrastructure before they provide long-term financing.

The small projects of multiple local governments need to be aggregated to access long-term financing at reasonable cost.

In seeking to achieve sustainable infrastructure financing, government agencies and related institutions must consider a number of key issues, including the provision of the PFMA as well as the public financing management regulation 202.

In addition, the model chosen for infrastructure financing should be underscored by clear and consistent objectives while addressing issues related to duplication of roles.

The infrastructure projects chosen must deliver value for money.

James Odongo, urban planner and the Research & Advocacy Manager, Architectural Association of Kenya