Graft, not the constitution to blame for widening fiscal deficit

During last week’s State of the Nation address, President Uhuru Kenyatta told Kenyans that the new taxes and austerity measures were due to the high cost of funding the new constitution, particularly devolution.

“The 2010 Constitution widened Kenya’s democratic space,” he said. “It also fundamentally altered the structures and functions of government. We now have two houses of government, the National Assembly has grown from 290 to 349 members and our new Senate has 67 elected and nominated members,” he said.

“We also have 47 governors, deputy governors and new County Assemblies in which sit more than 1000 MCAs. The enjoyment of the new right we gave ourselves in 2010 has been expensive and unprecedentedly so.”

This is however not true. While the new constitution increased Kenya’s wage bill in the public sector, much more funds have been lost through graft, wastage and greed at all levels of government.

Transparency International ranks Kenya at position 143 out of 180 countries globally in its 2017 corruption perception index. The index draws upon 13 data sources capturing assessment of local experts and business executives who share their experience on bribery, diversion of public funds, use of public office for private gain, nepotism in the civil service as well as State capture.

Kenya’s perception in the index has remained largely stagnant over the past five years, even as the country introduced new forms of government and independent institutions meant to check against corruption.

In 2016, the Ethics and Anti-Corruption Commission Chairman Philip Kinisu revealed that Kenyan taxpayers lose more than Sh600 billion annually to corruption, leakages and inappropriate expenditure. Corruption has also been devolved to the counties, where funds are wasted on inflated contracts and irregular expenditure.

In 2015 for example, current Senate Speaker Ken Lusaka was on the spot over reports that Bungoma county procured 10 wheelbarrows at Sh1 million.

Kisii County was similarly on the spot after the Auditor General queried the county’s operation of more than 64 bank accounts against the Public Finance Management Act. More taxpayer’s money is lost through government officials’ wasteful lifestyles. Just this year, Kenyan MPs voted to increase their pension by 700 per cent - pushing the cost to taxpayers from Sh262 million to Sh1.7 billion.

This is notwithstanding the high cost of operating moribund State parastatals used to reward political cronies at the expense of taxpayers. Last week, the World Bank cautioned that lack of transparency and corruption in the public sector could increase the cost of development loans Kenya receives.

Kenya’s money woes are due to wastage and greed and less the cost of expanded democratic gains.