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Objectively look at the third basis for revenue sharing

By Patrick Mureu | August 10th 2020 at 07:05:00 GMT +0300

There has been a lot of heat surrounding the proposed third basis for sharing revenue among counties.

Justifiably, everyone ordinarily wants to pull as more resources as possible towards oneself. In the current case, every leader would like to be seen to be pushing for more money towards their own counties lest their subjects think the leader does not care for their interests.

The consequence is that such a leader may lose the support of their supporters.

At the Senate, where the final decision on whether the adopt or reject the revenue sharing formula proposed by the Commission for Revenue Allocation (CRA) is to be made, standstill still persists. The senators have failed to agree despite sitting for debate over the same seven times.

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The impasse concerns whether Kenya should reinforce the current system in which county administrations are allowed to handle larger sums independent of the state, or whether we should follow the proposal which allocates revenues proportionally based on the population of each county.

But it is time we, as nation, had an objective look at this critical issue without emotion.

The CRA proposed formula was not only supported by the majority of our citizens during the Building Bridges Initiative (BBI) process of national consultation, but it is also a more sensible approach as far as our country’s long-term economic interests are concerned.

In recent weeks, claims have been packed with the assumption that if the new “one man, one Shilling” budgetary policy were to be implemented, our fellow citizens in certain counties with relatively smaller populations would lose out.

After 2013, devolution meant that a certain degree of power and funding were transferred from national to local governments, allowing the latter to more independently oversee budgetary policies relevant to their respective local communities. 

Despite concerns, the current proposal would by no means take away from the total sum spent on local communities in our counties. Rather, the central government would merely decrease the independent budget of county governments responsible for comparatively smaller populations while reclaiming oversight over the remainder of their funds. 

Allocating revenues to counties based on their population rather than their landmass or the size of their agriculture sector will have a number of benefits.

First, it will ensure that county administrations are more attuned to the policy issues most immediately concerning citizens. The one man, one-shilling formula would ensure that we all benefit equally from basic county services and moreover, hold our local government accountable if we see discrepancies.

The idea is for central government to reclaim oversight over the funding of broader policy areas such as improving the quality of our road system and other infrastructure, or the development of our agricultural sector. This would guarantee that such vital sectors to our economic productivity would come under a comprehensive policy directive. Indeed, agriculture and mobility are projected to play a key role in our country’s return to pre-Covid 19 levels of economic performance.

President Uhuru Kenyatta’s proposal will also benefit the fight against corruption. Despite the high hopes many of us had for devolution, we have all seen reports about the proliferation of cases of corruption. Decentralising development funding often meant that county budgets received less scrutiny from the State. As we have all witnessed, funding has sometimes ended up in the pockets of officials and private businesspeople rather than benefitting local communities. 

Furthermore, counties have often had trouble overseeing the extensive amounts of international development funding allocated to them. Multiple tenders provided by the World Bank were, for example, not put to use on time and had to be returned to the lender. By approving the formula proposed by Uhuru, and indeed backed by the majority of our citizens, we could ensure that our country does not lose out and that no excess funding slips through the cracks.

It is important to reiterate that this plan will not culminate in more disadvantaged areas receiving less attention and funding. The difference will simple be that instead of the often inefficient and ineffective responses formerly provided by county administrations, the central government will preside over these. With access to information from all counties and the know-how regarding what strategies work, the central government is much better suited to decisively tackle deeper-lying issues that often cut across county borders. 

More stringent rules of oversight will also help guarantee that this money goes where it belongs. The central government arguably has a higher stake in making sure that our citizens at the local level are satisfied.

If ineffective policies were to continue in one locality under central oversight, the ever-incumbent government would risk undermining their support basis elsewhere too. This is why the current proposal would provide for a higher quality of accountability in some of the most pressing economic matters.

With the far-reaching and negative economic impact of the coronavirus pandemic, it has never been more important to sponsor sensible policies.

A vote for proposed revenue sharing plan in the Senate is undoubtedly a vote in favour of our long-term economic interests.

Mr Mureu comments on socio-political issues [email protected]

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