Action points for strengthening governance in the counties

By Ndung’u Wainaina

Two years ago this month in this magazine, I wrote on the second anniversary of devolution and drew lessons, challenges and possible solutions/next steps.  In this article I attempt to give practical policy steps to take after four years of experimenting with devolution. This policy brief recommends drastic measures to rationalise and restructure national MDAs, to cut costs and remove governance duplication, strengthen the devolved system of governance, support county-based economic and private sector investments, and improve quality social/public service delivery in the counties.

The Constitution of Kenya 2010 will in August this year turn seven. Coincidentally, the country will also be holding its second general elections under the new Constitution in the same month.

The Constitution 2010 did not only significantly restructure the governance system and redesign how the people relate to it, but also established a devolved system of governance, which was a relief from the hybrid mongrel of presidential and parliamentary systems.

This constitutional order offered renewed hope and aspiration to the Kenyan people and to a country ravaged by many years of dictatorship, economic decay and corruption, and human rights violations. However, for Kenyans to enjoy a democratic, secure, stable and shared prosperous future, faithful and full implementation of the constitution and devolution is mandatory.

When Kenyans voted to have a new constitution, they expected a devolved system of governance where powers and resources are transferred to autonomous devolved units across the country, to enable communities plan their priorities and development at the county level. This would make it easier for communities to hold their leaders to account as a result of their close proximity to the people, plan in accordance with their preferences and needs, as well as ensure previously neglected areas in the country receive resources for development and provision of essential services.

Kenyans have, in the last four years, been on a worthwhile journey in experimenting with the devolved system. The results are proving very positive. It is time to start the process of consolidating the four (4) years of dividends of the devolved system of government.

One major challenge for the devolution process is that the national government policy on devolution and the County Government Act were drafted without comprehensive restructuring of national government ministries, departments and Agencies (MDAs), which remain as they were before devolution.

The national government, while free to infiltrate its policies at the county levels, must do so through the structures recognised under the Constitution, and not run a parallel system. The law is clear that the national government may channel grants, whether conditional or unconditional, to the county governments as additional revenue within the meaning of Article 202, and not any other entity that performs the functions allocated to the county by the Constitution. National government cannot purport to channel grants to an entity whose intended projects effectively undermine the role of the government at the county level.

In the last four years, the national government has successfully, through the National Assembly, pushed legislative and administrative processes that subvert devolved functions.

This is evidenced in the Water Act, 2016, The National Drought Management Act, 2016, the Land Laws (Amendment) Act, 2016, the Community Land Act, 2016, and the Roads Reclassification Act, among other unconstitutional laws that courts have often revoked. The situation is being escalated through the budgetary process now. Further, there are still serious problems on how the two levels of government cooperate and operationalise the execution of shared and or concurrent functions. Costing of the devolved functions has been blocked, adversely affecting devolved services delivery by the county governments.

The Constitution changed the economic, fiscal and taxation policy. The current revenue and taxation regime is fiscally unbalanced as the national government continues to determine fiscal policy, with very limited participation of the county governments. Further, Vision 2030 has not been radically reviewed and reformulated to bring it into conformity with constitutional dispensation. This has had adverse effects on the ability of county governments to play the significant role they are meant to, in determining economic, fiscal and taxation policy of the country, as well as help secure their broad financial autonomy sustainability.

County governments must ensure that every function either directly or indirectly implied by the Constitution to be exclusively devolved or shared or concurrent is implemented.  Resources and functions that line ministries, departments and agencies of national government continue to hold unconstitutionally at national level will have to be surrendered to the county governments.  Duplication of functions that causes unnecessary wastage and conflict must be eliminated through Articles 1, 6, 10, 174, 183, 187 and 189 of the Constitution.

County governments are the new factories and innovations hubs for Kenya. They play a pivotal role in propagating local economic development and regulating the private sector in their jurisdictions. In the last four years, the country has seen national government adopt and implement a dangerous debt-propelled economy. Exports, agriculture yields and manufacturing have declined tremendously. When Kenyans voted for a devolved system of government, they expected power and resources to transform local economic development and ensure efficient and effective service delivery.

County governments are gaining in authority, powers and legitimacy, and becoming more prominent in driving local economic development. Counties are the new factories and innovations hubs for Kenya. They play an important role in local economic development, and supporting private sector in their jurisdictions. An important precondition for pro-poor economic growth is that county governments understand their potential role in supporting private sector development, and are aware of the opportunities and constraints for the private sector in their jurisdictions.

County governments contribute in various ways to providing an enabling environment for pro-poor economic growth. First, county governments should foster effective and efficient registration and licences for business and property activities. Good economic governance means predictable and reliable action by county governments, through the application of accessible, affordable and transparent policies and procedures. This also implies that taxes and levies should be collected and used in a transparent way. Secondly, county governments should focus on economies based on export-led growth, manufacturing and diversification through building transparent and favourable competitiveness environment and property rights regime that support business.

Thirdly, counties must strengthen the devolved system of government as the driver of transforming peasant, rural agriculture-founded economies into modern, high-yield value added export-oriented productivity. This will see strengthen the county-based local private sector, build inter-county economic cooperation and support local small-scale manufacturing.

Finally, counties must ensure regulatory institutions that do not perform well their assigned job of providing oversight, and accountability and transparency are strengthened, including separating legislative policy from executing function to avoid conflict of interest, to ensure efficiency, probity and prudent spending of the public resources.

The National government has not been unable and/or unwilling to address the security and policing system in context of devolved system of government, informed by unique local security challenges and dynamics. Localised policing and law enforcement is the bedrock of successful policing and crime prevention.

County governments will need to start to hold political campaigns to enforce restructuring, aligning, downsizing and rationalising of national government ministries, departments and agencies of the following sectors to accord with and respect devolved system of government: infrastructure; energy; ICT; education; technical and vocational training; health and sanitation; governance; security and justice; environment, water and natural resources; agriculture and land management; economy, commerce and finance; sports, culture and recreation; urban development, housing and physical planning and; international relations and commerce/trade.

Key actionable policy directions for implementation

There is need to ensure allocations to county governments are increased proportionate to the national revenue share. Big budget allocations to national ministries, departments and agencies must significantly be reduced as majority of them have policy and regulatory mandate where counties hold responsibility of service delivery. We must adopt a policy of “more county, less national”. We must also review the fiscal, taxation and economic policy to give county governments’ direct influence and voice in conformity with the design of devolution.

There is need to restructure, align, rationalise and downsize national ministries, departments and agencies and regional sector-wide authorities, in the spirit of devolution, to remove costly, parallel and duplicate functions, and also release the funds being held unconstitutionally by national MDAs. This also includes a massive overhaul of national policies, regulations and laws to bring them into conformity with the Constitution and devolution.

We must strengthen institutions that facilitate intergovernmental relations and ensure national institutions support devolution to build better relations between national and county. In tandem with that, there is need to streamline and hasten the process of transferring funds, conditional grants and donor funding to county governments.

We must develop capacity and capabilities of institutions, systems, processes and procedures of the county governments for purposes of sound policy, law and regulation formulation, integrated planning, budgeting and performance management, effective policy execution, and quality service delivery.

Next, we need to carry out comprehensive audit of assets in the counties, including land and property – something the Transition Authority ought to have done four years ago – for proper planning and future utility. We must also conduct county-based human resource assessment to harmonise personnel with needs and skills, and reduce bloated unsustainable task force and wage.

There is also need to institute comprehensive land reforms to ensure accessibility of land resources fairly by all citizens, and creation of a transparent land and property registry to enforce equitable share of natural resources wealth.

We must devolve certain policing services to address the security and policing system in context of devolved system of government, for counties to be responsible for public safety and security within the county.

Internally, county governments have to set up institutions, processes, systems and procedures that are competent and results-oriented. Devolved units need to review the progress made in their capacity and set institutions and systems to address shortcomings. As well, county governments need a strong voice at the national level – currently achieved through the Council of Governors – in order to speak with a collective voice on national policy that affects counties, share best practices, and develop innovative solutions that improve county government and support the principles of devolution.

There is need to establish county government accountability offices to help improve performance, accountability and service delivery in counties. This office will be tasked with providing objective, fact-based and timely information in a bid to make county governments more efficient, effective, ethical, equitable and responsive, while ensuring value for money and improved county government operations. This office will be independent financially, structurally and operationally. Its work will be to support the Governor meet his/her constitutional responsibilities.

The accountability office will conduct continuous comprehensive monitoring and audit of the operations and service delivery to determine whether county funds are being spent efficiently and effectively. It will also conduct professional investigations on allegations of illegal and improper activities of the county government, its agencies and employees, in addition to generating quarterly reports on how well county government programmes and policies are meeting their objectives, with clear policy analyses and recommendations to facilitate more effective quality service delivery, viable sustainable communities and balanced county development.

Further, there is need to set up rapid assessment and action plans to improve the nature, quality and distribution of service delivery mechanisms, to ensure better spending by county governments. Devolution has allowed counties more control over their own resources, but prudent and effective spending has been elusive. Having money, which the devolved units need more of, is just part of the solution; they must correctly analyse how they spending the money.

The starting point is an assessment of conditions in the counties. This mechanism allows county governments to identify factors causing poor service delivery, to concentrate on systemic, management issues, including public financial management. It then outlines an action plan, including the required financing, to deliver improvements and monitor accountability progress.

This strategy will seek to identify specific problems in service delivery and then outline an action plan that includes monitoring and accountability of progress. It will analyse development indicators and challenges to determine areas that need improvement.

County departmental officials will work with specialists to identify how money should be spent prudently. Action plans will then be developed to map the steps needed to achieve set targets, along with an estimated budget and time frame. This will stop misuse of revenues. This approach will allow county governments to diagnose complex causes of service delivery problems “from the bottom up”, by using a systematic diagnostic framework and inputs from experts to identify specific failures.

The diagnosis starts with service delivery “symptoms” like ineffective antenatal care, and concentrate on underlying failures in core management systems, including public financial management, that cause these symptoms.  To ensure the action plan is implemented, a financing plan will be included, as well as methods to address poor capacity and governance problems. County governments should also consider seeking financial support from development partners to support this initiative.

There is also need for networking for county governments to share their experiences and knowledge. Creating a platform for local governments to exchange their opinion, challenge, issues and best practices would be useful for local governments. An inter-county cooperation of several county governments creates horizontal cooperation among local governments, and helps in gathering information and opinions from local governments, lobbying national government, advocating members interests in national and international policy dialogue, and increasing governance and transparency by sharing knowledge, information and good practices.

Developing a database of successful/unsuccessful projects will help county governments learn in developing and implementing projects. By looking at details of actual project structure and financing models, county government officials, as well as private investors, can learn how to adjust such successful project to their local situations, and how to avoid failures.

Rigorous, well-structured multi-stakeholder dialogue needs to happen on appropriate systems of intergovernmental relations on revenue sharing and taxation policy – this explains why Vision 2030 has to be fundamentally reviewed to conform to devolved governance and development. Budget making is still largely in favour of the national government. Failure to do a comprehensive costing of functions and set needs-based budgeting process continues to weaken county governments ability to deliver on their mandate.

Currently, mechanisms that would enable county governments to mobilise part of the wealth produced within their jurisdictions to be reinvested in local development are not in place. Local taxation remains underdeveloped, and conditions to capture a portion of the capital gains in land value and economic activities are often not met. County governments generally lack the buoyant tax sources that would produce revenue growth in line with their responsibilities.

The vast majority of taxable goods and services are often concentrated at the national level, and systems of redistribution to local governments through transfers and grants do not guarantee equitable distribution. Diversifying and expanding local tax bases is clearly needed. In fact, there are already models here: Some countries do allow local authorities to benefit from national economic growth through the taxation of economic activities, people’s income or local sales. Allowing county governments to access part of the value of public land — particularly that originated by public investments, for instance, in roads or new equipment — is another very promising way to finance county investments.
Forging strong partnerships between the County Governments and the private sector is vital. County governments play the pivotal role of regulating, growing and strengthening private enterprises. However, these governments have limitations in personnel, funding, knowledge and skills.

Governments and local business communities will need to forge “new alliance” to adopt a “new mind set” where both accept a fairer balance in risk and reward in projects, and work together over the long term. Second, this new alliance means the business community will need to accept some adjustment to the traditional model of Public Private Partnership (PPP) they are used to.

It will certainly mean a commitment to “invest in people”, in the capabilities of their employees — and a huge commitment towards the development of their local partners in county governments. For international companies and private investors more concerted actions at local levels will be needed to build platforms to showcase projects that really contribute to sustainable development.

Finally, proper and timely communication to the residents and various stakeholders makes all the difference. Effective channels of communication, interaction and participation created by county governments provide critical information and feedback. There is need to broaden citizen participation in local governance. Regional governments must build municipal capacities to be more representative of and responsible to citizens’ concerns and needs, through the improvement of financial performance, services delivery, transparency and accountability.

Involving community groups to work in collaboration with local government in the process of planning, prioritising, funding, implementing and overseeing investments in public-private partnerships to address community needs is desirable. This will ensure concerns raised are addressed quickly and a correct narrative of the work the county government is doing is well explained to the residents.  It will also assist in shaping the county government policy agenda and implementation status.

Writer is Executive Director, International Centre for Policy and Conflict