Fighting poverty calls for an overhaul of our budget priorities

By Billow Kerrow

Cotu boss Francis Atwoli has pulled off his Labour Day threat and issued the statutory notice for the first ever workers’ strike by his 1.5 million members.

The Government may have done well by removing the taxes on kerosene, maize and wheat flour and offering a 12.5 per cent minimum wage increase, but the concessions were unceremoniously presented and hence lacked the punch to pacify the workers.

Had the President attended the function and announced these measures with a pledge to do more, Atwoli would have lacked the will to go ahead.

Instead, the President and Prime Minister skipped the function; the minister was casual and inimical and the workers felt slighted.

Our Government has the resources but quite often lacks the focus and will to make meaningful changes to the lives of our poor.

Our economic policy advisers recycle the same old elitist policies that do not create jobs or wealth for the unemployed and poor majority. It is this epitome of incompetence that blinds policymakers from prioritising resource allocation to where people need it most.

In the 2011 Budget Policy Statement, Treasury as often argues that the current economic growth rate of 5.4 per cent is inadequate and that it must exceed 10 per cent in order to create jobs. How? In 2007, we were doing over 7 per cent but still there were no jobs—just the usual informal sector estimates of 500,000.

Treasury wants the Government to ‘remove factors that constrain our efforts’ to achieve the 10 per cent economic growth; who is the ‘Government’ if Treasury is not?

Kenya can actually support its poor by subsidising the prices of basic commodities such as flour, kerosene, cooking oil and sugar because it can afford it. It’s our priorities that are wrong.

According to a recent IMF study, our country is directly affected by increase in the international food prices because we are a net importer; a 10 per cent increase in international prices of wheat, maize, sugar or rice will lead to a 10 per cent increase.

Our staple diet is not cassava, matoke, or yams but maize, wheat and rice.

Our agricultural policies remain on paper, and are archaic albeit elitist in nature too. For instance, small-scale farmers account for 70 per cent maize production but their use of improved inputs such as hybrid maize seeds, fertilisers and farm machinery is very low.

These farmers still account for 70 per cent of the marketed agricultural produce; largely without access to subsidised fertiliser and AFC loans.

We find it difficult to allocate a few billions to the National Cereals and Produce Board to buy the maize from them even at Sh2,000 a bag to supply the millers, but willingly import the same at more that Sh3,000.

In 2009, our best year, the maize production was 200,000MT, which was half our annual consumption.

We create jobs and wealth if we invest in the development of the productive sectors and infrastructure, which is lacking in our public expenditure priorities.

In 2009, our Defence spending was $700 million, equivalent to that of Ethiopia, Tanzania and Uganda combined, yet we are not at war. In the proposed 2011/12 Budget, we plan to spend Sh107 billion on Defence and other security services.

Compare this security budget to the total allocation of Sh80 billion to the combined ministries of Agriculture, Livestock, Co-operative Development, Fisheries, Lands and Water.

Furthermore, we do not often spend the proposed sums on the infrastructure development. In 2010/11 budget, Sh86 billion will not be spent.

This is 30 per cent of the Sh320 billion development budget approved by Parliament. Reasons? Change of priorities.

With all these facts in the Budget open to all, our workers will find the Atwoli strike appealing.

—The writer is a political economist and former MP for Mandera Central