The other day, grinning Treasury mandarins surrounded President Uhuru Kenyatta as he signed the Division of Revenue Bill 2018-19 into law.
Discerning minds would’ve noticed three things in that picture — the absence of substantive representation from the Council of Governors, a rather grotesque symbolism in the mocking smirk of those with their shadow hovering over the President and the suggestive formality divorced from the reality.
The enduring statement of that picture is that the national government or at least Treasury bureaucrats own devolution, in complete reversal of what is stated in the Constitution.
They do so because they not only control the purse but also determine how much of that purse, and how much trickles down to the people at the counties, who are the providential owners of devolution.
The annual division of revenue law is an arbitrary Treasury statue and constantly thrashes about with impunity, hence, the grotesque image in that picture of a cabal of hounds readying for the kill.
There is a kind of sadistic satisfaction in this. The Division of Revenue law determines the sharing of national revenue between the two levels of government. But before it becomes law, the Commission on Revenue Allocation, the constitutional agency mandated to ‘advi se’ on revenue sharing, has a bite of the cherry.
Since 2007, CRA has never been taken seriously in its ‘constitutional’ recommendations, despite monumental resources spent on researching the ‘advice’. CRA customarily recommends higher allocations to the county after forensic costing of functions but crudely, it is not even the Senate, as the protector of the counties, that decides how much goes to them, but the Treasury.
Of its own volition, in violation of the Division of Revenue Law, the Treasury reduces the amounts due to the counties. This year Sh15 billion has been cut from what the law initially provided. But that isn’t what irks most. The national government’s share isn’t subject to tranche disbursements like the counties’.
The national government receives its full allocation, while the Treasury determines the counties’. We’ve to ask, what irreparable damage would Kenya suffer were it to set aside Sh400 billion voted for by Parliament in an escrow account for the counties?
In view of this crippling of devolution, it’s odd that Deputy President William Ruto would be virulently against any review of the Constitution that he opposed in 2010. He should ordinarily be at the forefront of pushing for its review.
However, it appears he has other things on his mind, including fear of losing the winner-takes-all advantage as he covets being elected President.
What is the aftermath of Treasury meddling? Starving the regions of money killed the Majimbo system of 1963. The same trend set in after 2013, with maladministration of county functions and short-changing counties on finances.
The trend by the Treasury hasn’t ended. Counties have had to do without development programmes after being starved of cash, yet the Fifth Devolution Conference in Kakamega next week is anachronistically themed ‘Sustainable, productive, effective and efficient governments for results delivery’.
Already, national officials are billing the Conference as seeking ways to deliver on Uhuru’s ‘Big Four’, yet the issue ought to be why counties are facing problems in sustainability, production and suffer ineffective and inefficient results delivery. Why are stalled projects dotting the county landscape? Why is the national government so infatuated with duplicating county functions under the Big Four?
As participants nod off at the conference, counties are in default of paying for supplied goods and services, and they incur heavy fines. Many have defaulted on expensive commercial loans they were forced to seek to even pay salaries. Counties are insolvent in real terms but were banks to sue, many would be declared bankrupt.
Kenya is borrowing expensive loans to pay escalating loans’ interest, while counties borrow to plug the hole in accrued loans.
When a country can’t pay salaries on time, it’s stone-broke. Incidentally, the county debts mirror proposed budgets for the Big Four, focussing on health, education, agriculture and manufacturing.
Wouldn’t it make fiscal sense to allocate counties the budgets targeting these areas and ask for results?