Financial prudence critical in counties

When Kenyans opted for devolution, the single most important driving motivation was to address skewed resource allocation, and top-down decision making by the central government which influenced how, what and which development priorities for every corner of the country. We developed a model of devolution that allowed county residents to determine their leaders through universal suffrage, and establish both an executive branch of government, and a legislative arm that will together determine their priorities while providing appropriate checks and balances to ensure effective service delivery and equitable development across the nation. Devolution was to place sufficient resources at the grassroots to fairly develop all areas, devoid of political patronage and official wastage.

In drafting the public finance chapter in particular in the Constitution, we created a robust system similar to that of the national government in budget-making and approval process, fiscal responsibilities and financial management that allows the county assemblies to exercise enhanced oversight over the process. Once funds were transferred to a county, it was up to the county government which comprises both the executive and the assembly, to decide how to spend it, quite independently from the National Treasury.

As the former chair of the technical working committee of the defunct Constitution of Kenya Review Commission (CKRC) that drafted the public finance chapter, I played a key role in ensuring that the counties would exercise a significant degree of independence in their financial management. We were then motivated by the desire to escape Treasury’s patronage in management of the county affairs.

It is, therefore, quite disconcerting to see reports of financial mismanagement and misplaced priorities in the counties that profoundly undermine the essence of devolution.

It is particularly disappointing when Kenyans are treated to reports by the watchdog institutions of irregular expenditure that take the pattern of the perennial adverse reports of the national government. Quite unacceptable! We cannot replicate national government’s misplaced priorities, wastage, inefficiencies and misappropriation at county levels and have the audacity to claim it is aluta continua! That what is good for the goose is going to be good for the gander! No!

But the most challenging blemish on the financial landscape in the counties by far is the unbridled greed for largesse by county assemblies that were created to check the excesses of the Executive. The role of the assemblies is to create an appropriate regulatory environment by enacting relevant legislation, and to provide appropriate oversight over the policies, programmes and expenditures of the county executive. The Constitution does not contemplate power sharing between the county executive and the assemblies.

The county executive has a mandate to set their development priorities and policies like any executive and the role of the assemblies is not to obfuscate and override them at will but to serve the interests of the residents in checking them in accordance with the law.

Assemblies cannot draft budgets for the executive, or set its development priorities and worse still determine resource allocation at will. There are assemblies that demand half the revenue allocated to a county, and others that demand they draw up the county budget in its entirety. Moreover, funds should be allocated to assemblies to enable them to carry out their mandate effectively, not to exercise unlawfully acquired executive mandate. If we allowed that to happen, it will be a recipe for chaos in management of resources in the counties, and service delivery will take the backseat.

The Controller of Budget and the Commission on Revenue Allocation have sought to address these emerging challenges by recommending certain budgetary limits to ensure devolution succeeds. It is not the intention of these watchdog institutions to micromanage counties but to apply the spirit of the law to bring order in public finance.

Our Constitution sets certain financial management principles that must of necessity be applied to ensure accountability and prudent use of resources. It is increasingly becoming apparent that Parliament may have to review the regulatory framework to check the unabashed appetite by assemblies to live large in the counties at the expense of development.


 

Related Topics

devolution CRA