Public Private Partnerships key to financing projects, say officials

ICPAK chairperson Elizabeth Kalunda and Irrigation PS Ephantus Kimotho in Mombasa on Tuesday /JOHN CHESOLI

Sustainable Public Private Partnerships are the sure bet that can be used to transform Kenya’s economy, two Principal Secretaries have told accountants.

Irrigation PS Ephantus Kimotho and his Parliamentary Affairs counterpart, Aurelia Rono, on Tuesday said sustainable PPP projects are cheaper in the long run and lift the burden from the country’s budget.

The two said PPPs need to be taken not as alternatives but as one of the mainstream ways of financing infrastructure so as to leave the budget to deal with the social infrastructure like education and health.

This would unlock the potential of the country’s economy by doing huge infrastructure projects and at the same time create opportunities for the private sector.

“Under private capital, from the onset it might look like it is expensive but with its efficiency and speed of actualisation, you end up realising that eventually they end up giving you more value for money.

“This is because we need to balance between affordability and value for money, and accountants are best placed to do that,” Kimotho said.

He spoke during the 42^nd Institute of Certified Public Accountants of Kenya annual seminar in Mombasa.

Kimotho said with PPPs, risk is shared with the private party.

These risks include finance, market, and operational risk, leading to the government safeguarding public assets.

“Those are some of the cornerstones of ensuring a successful PPP,” the PS said.

PS Rono said the accountancy profession is a cornerstone in every sector including civil society, the church, government institutions, and the smallest group in the village.

She called on accountants to embrace integrity in all the institutions to ensure resources are used prudently to achieve the objectives they serve in including government.

“This is a clarion call to embrace accountability, transparency, integrity and discipline in managing financial resources to ensure that we deliver the goals and objectives we desire to achieve,” Rono said.

She said if all accountants served with integrity, the country would transform fast from a third world to a first world nation.

Prudent management of public resources is key to achieving social and economic justice in the country.

A lack of integrity among accountants, manifested primarily as corruption, is a major impediment to equitable resource distribution, sustainable development and poverty reduction.

Lack of integrity diverts public funds intended for essential services like healthcare, education, and infrastructure to private individuals.

This directly harms the poor and marginalised, exacerbating socio-economic inequalities.

“The Eurobond issue is one such matter that a lack of integrity cost us as poor Kenyans. The money that was meant to build roads, markets and hospitals was diverted to individuals’ pockets and we ended up paying for services not rendered to us.

“That is why we still have schools where children learn in mud-walled classrooms that have no floors. Money that was supposed to build those schools was eaten,” Morris Ochieng, a CPA, said at the seminar.

PS Kimotho said Kenya needs to build capacity of contracting authorities and members of ICPAK are best placed to do that because they are well trained on matters finance structuring, business finance and financial management.

The two appealed to ICPAK members to partner with the government to unlock the potential of PPPs.

ICPAK CEO Grace Kamau said certified public accountants have committed to upholding ethical working practices.

She said accountants have a critical role to play in the transformation of Kenya from a third world to a first world country.

“The resources we have in this country are enough to transform us to first world but where are these resources wasted along the line that we still end up being a third world country?” Kamau posed.

She said many of the commissions in the country like the Ethics and Anti-Corruption Commission would not exist if accountants conducted themselves through ethical means.

Kamau said the debt management of the country is also a function of accountants and possible solutions to the debt problem will be discussed at the seminar.

“Every member will have an opportunity to define the Kenya we want and accountants will be central in that transformation that we want,” the ICPAK CEO said.