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Is devolution working as it should?

While some people feel that devolution has resulted in more development at grassroot level, others believe that problems of governance on the national level have been transferred to the counties.

BY LOYD KIBAARA

The emerging political debate on possibilities of changing part of the Constitution has triggered a debate on the effectiveness and viability of devolved units. Proposals have been floated on the possibility of reviewing county boundaries with a view of making devolution work better.

The big question is; Is devolution working as it should? For some, devolution has resulted in more development at grassroot level. It has led to new roads, new dispensaries and greater self-determination. For others, the problems of governance on the national level have been transferred to the counties, including mismanagement, lack of capacity to implement projects and corruption.  A section of the population feels devolution has resulted in wasted resources and multiplied theft of public resources. Of the two points of view, the truth is probably somewhere in between.

Counties’ development

Are Counties bringing development closer to the people? Fact is, Counties have received hundreds of billions of shillings in the last six years. This money has been distributed based on a redistributive formula proposed by the Commission on Revenue Allocation (CRA) and approved by Parliament. Indeed, there does seem to be evidence that at least some of this money is building new roads, new health facilities, new early child development centres among others.  Devolution has so far delivered and increased the number and the reach of capital projects. The more difficult task, however, is to ensure that service is also delivered.

To understand this, it is important to distinguish between investment in capital projects and true development, a distinction that is frequently ignored in public debates in Kenya.  This means planning for and using the recurrent budget: personnel and operational costs that ensure that capital projects deliver. It also involves redistributing human resources, recruiting and retaining skilled professionals, and demonstrating managerial capacity. In this regard, we have a long way to go

Revenue collection

Counties are failing to collect revenue, undermining the potential of devolution to lead to economic transformation. Actually, some counties failed to collect as much as local authorities in the first year of devolution, but on average, in 2013/14 counties raised more (KSh26.3 billion) than local authorities raised in 2012/13 (KSh24.5 billion). These figures have continued to rise, until 2016/17, when they declined modestly. It is important to note that counties have the same revenue-raising powers as local authorities did before them.

While it is true that a handful of the economically advanced and urbanised counties are under-collecting property tax and business permits – which are the biggest sources of revenue for most counties – truth is that most counties are more rural and do not have economic structures that lend themselves easily to greater taxation. This leaves counties relying more heavily on user fees for services, such as charges to patients at health facilities. While these kinds of fees can help to fill budget gaps, they can lead to a decline in access to services for the poor..

National Government’s effectiveness to support Devolution

The National Government through the Ministry of Devolution and the Senate have so far not been as effective as envisioned in strengthening devolution. Six years down the line, there is a general level of incompetence around how to manage Counties sensibly.

Failure by the Transition Authority to fully address various transition issues is an indication of lack of effectiveness. This has made it difficult to address significant challenges, such as the need to devolve, or at least to reform various state corporations in the roads, water and energy sectors. Maintaining these corporations means maintaining control and money at the national level.

An area of concern is that money seems to flow to counties somewhat slower than it flows to other government agencies each year. Counties are also receiving a smaller share of increasing total revenues than the share going to the national government.

On their part, Counties have struggled to approve budgets and, therefore, have created delays in accessing funds.  The decisions by national institutions that have led to escalating wages for health workers and other county officials points to an inability to cooperate across levels of government to control costs. The failure of the National Treasury to provide proper guidance to counties on, for example, how to implement programs budgeting, is a clear lack of capacity and vision at the national level. Even the national government has fallen short on these reforms, so it is not well-placed to advise counties.

There is quite a bit of sound and fury in success of devolution. Counties are making the first important steps toward bringing development to the people, but they are more apt at the capital than the operational side of things. There is need to make counties less dependent on national transfers by giving them additional legal ways of raising funds.

Loyd Kibaara is the Country Director, Kenya, Tisna Education & Research Services International. Email: loyd.kibaara@outlook.com

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