When a parastatal like KPLC fails to provide reliable electricity, it erodes public trust in the government's ability to manage essential services effectively. This can lead to a broader perception of governmental incompetence and corruption. When a parastatal like Kenya Railways fails to provide dependable public transportation, it reflects poorly on the government’s ability to manage critical infrastructure. Parastatals can and have many a time diminished public confidence in the government’s competence and commitment to improving the quality of life for its citizens.
The failure of the National Environmental Management Authority in undermines public trust in the government's ability to protect the environment and enforce environmental regulations. When Nema does not effectively monitor or respond to environmental violations, it risks environmental degradation, health hazards, and legal uncertainties. This failure not only impacts ecosystems and public health but also reflects poorly on Kenya's commitment to sustainable development goals and international environmental standards. These problems are in the glaring eye of the public, who will blame the government.
The challenges many parastatals are engrossed in highlight the urgent need for strengthened governance, enforcement, and accountability if the government is to attain quality service delivery, regain public confidence and ensure a sustainable future for all Kenyans. The recent moves by President William Ruto's administration to centralise control of parastatals under the Office of the President signal a bold attempt to combat inefficiency and corruption in these state entities.
The creation and establishment of parastatals in Kenya were primarily outlined in Sessional Paper No. 1 of 1965 on African Socialism and its Application to Planning in Kenya. This document laid the foundation for the development of state corporations, also known as parastatals, as instruments for implementing Kenya's development agenda and promoting economic growth, social welfare, and public service delivery. These parastatals were intended to play a significant role in many sectors of the economy, including infrastructure development, utilities, agriculture, and industry, among others.
Parastatals have long been a critical part of Kenya’s economy and service delivery, but they are often plagued by financial mismanagement, nepotism, and corruption. President William Ruto's Executive order must have been aimed at addressing these issues head-on by streamlining operations and improving oversight. Indeed, Felix Koskei, the Head of Civil Service, has variously held intensive meetings with state agencies and corporations since the Kenya Kwanza government came into office, calling on them to intensify fighting corruption and enhancing efficiency, emphasising their integral role in government.
Governance reforms in the new guidelines likely include restructuring boards’ composition, enforcing stricter qualifications for board members, and establishing clear roles and responsibilities. New guidelines might introduce stringent financial management practices, including better budgeting, financial reporting, and resource allocation mechanisms. Transparency and accountability measures might well involve public disclosure of financial statements, procurement processes, and decisions made by state corporations.
Regular performance evaluations for both employees and the corporations, including setting clear performance targets and indicators will be mandated. The guidelines emphasise that the recruitment of CEOs and university chiefs should be based strictly on merit. This includes considering the educational qualifications, professional experience, and past performance records of candidate.
"Regulatory agencies must lead by example in stopping corruption and improving efficiency," Koskei stated at the Kenya School of Government in 2023. "You are a crucial part of the government, and your actions directly impact the public trust and the effectiveness of our operations. We expect you to uphold the highest standards of integrity and performance."
Recent developments like the Executive Order issued on May 25, show the Kenya Kwanza administration believes that placing these corporations directly under the presidency will ensure tighter control, greater accountability, and increased efficiency. The goal of this executive order must have been to streamline and enhance efficiency in the management of parastatals, ensuring they serve the public good without being mired in corruption and waste.
The government has been undertaking governance reforms for Ministries, Departments and Government agencies, particularly through the Executive Office of the President. These reforms are in financial management, transparency and accountability, performance management where performance contracting was introduced, tightening of procurement processes to eliminate corruption and augment audits and risk management.
With the President's office directly overseeing parastatals, it will be easier to monitor performance and enforce strict measures against misconduct. "We are committed to creating a system where every action and expenditure is accounted for, and where there is no room for mismanagement," Koskei said.
Often, decision-making in parastatals is slowed down by multiple layers of bureaucracy, which hampers efficiency and timely action. By cutting through these layers, the government hopes to facilitate quicker, more decisive actions to address inefficiencies and implement necessary reforms. Decision-making must be streamlined if Ruto’s government is to respond swiftly to challenges and opportunities considering the government’s limited time.
Aligning parastatals under a single management structure can ensure they operate in harmony with the national development agenda. This alignment is crucial for achieving strategic objectives such as economic growth, job creation, and improved public services. Strengthening internal audit mechanisms and enhancing transparency are vital components of Kenya government's new strategy. The robust audit mechanisms and the fostering of a culture of integrity will ensure parastatals serve the people effectively and tangible results are seen.
Felix Koskei has been clear about the administration's vision saying. "This is about making our parastatals work for the people of Kenya. We want to eliminate waste, stop corruption, and ensure these entities contribute positively to our economy and society. It's a bold step, but a necessary one for the future of our country."
Political commentator