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Counties face fresh push to fix revenue and spending gaps

Speaking during a Radio Generation interview on Tuesday, KDSP II National Programme Coordinator Samwel Nyaga said the second phase was developed to address problems that continued to affect the performance of c...

By Chrispho Owuor
4 min read
Counties face fresh push to fix revenue and spending gaps

Kenya’s 47 county governments are set for a fresh push to improve how they manage money, staff and public resources under a four-year programme targeting persistent weaknesses in the devolved system.

The Second Kenya Devolution Support Programme (KDSP II), funded by the Government of Kenya and the World Bank, is seeking to strengthen financial management, institutional performance, accountability and public participation to improve the delivery of services at the county level.

The programme comes after an assessment found that several governance gaps remained in the devolved system despite progress made under the first Kenya Devolution Support Programme, which ran from 2016 to 2021.

Speaking during a Radio Generation interview on Tuesday, KDSP II National Programme Coordinator Samwel Nyaga said the second phase was developed to address problems that continued to affect the performance of county governments.

“KDSP II is actually a successor of another programme called Kenya Devolution Support Programme. By now we call it Kenya Devolution Support Programme One, but ideally we didn't have one. We only put one after we developed the second one. This is one of the most critical programmes we have in this country, basically because it addresses the software part. A lot of times we focus on development, the brick and mortar. However, this is not possible if you don't address the governance issues.”

Nyaga said a 2023 assessment helped identify the areas that needed further support, leading to the programme being organised around three main areas.

“The critical gaps we categorise into three. One is the issue of financial management, financial expenditure management. Then there are issues around human resource management and performance management and intergovernmental relations. Then there are issues around accountability. There are issues around participation, and there are issues about oversight.”

One of the major challenges being addressed is the ability of counties to raise enough revenue locally to supplement funds they receive from the national government.

Nyaga said limited own-source revenue has left some counties unable to fully meet their budget commitments and provide services as planned.

“One of the gaps is because our devolved units are not able to raise enough resources within themselves that they are able to plug in into their budget. So then that becomes a gap that we are interested in and we have been addressing.”

KDSP II is also targeting the problem of pending bills, with Nyaga linking the challenge partly to budgets that do not accurately reflect the amount of revenue counties are likely to collect.

He said the programme is working with the National Treasury to develop a scientific model that counties can use to make more realistic forecasts of their own-source revenue when preparing budgets.

“If you do not do proper forecasting, that means you are likely to estimate that you have more resources than you actually have. We are committing based on a budget that is not realistic. One of the strategies that we have employed in KDSP II is to bring on board the National Treasury to develop a scientific tool for own-source revenue forecasting, a model.”

The programme is also addressing challenges in county human resource management, including high wage bills, weaknesses in organisational structures, staff establishment, skills gaps and performance management.

Beyond finances and staffing, KDSP II is seeking to improve the way residents participate in decisions affecting their counties.

Nyaga said the programme wants to move public participation beyond simply meeting the legal requirement and instead make it a process through which citizens understand proposals, give their views and receive feedback.

Updated public participation guidelines have been developed to provide counties with procedures for engaging residents and ensuring they have a better understanding of matters under discussion.

The programme is also using project management committees made up of local residents to increase community involvement in development projects.

“They are the ones who are overseeing what is being done. Those are some of the strategies we have actually employed to ensure that there is effective and meaningful public participation.”

The approach is aimed at strengthening the wider goals of devolution, including bringing services closer to citizens, ensuring resources are shared fairly and giving residents a stronger role in overseeing government programmes.

The World Bank has previously identified weak county revenue collection, unrealistic own-source revenue forecasts, high wage bills and weaknesses in public financial management among the challenges affecting the effectiveness of devolution.

KDSP II therefore seeks to improve not only the delivery of projects and services but also the systems that county governments use to plan, spend, manage staff and account for public resources.

The four-year programme is expected to build on lessons from the first phase while giving counties further support to strengthen their institutions, improve financial management and increase citizen oversight.

The overall goal is to help county governments become better equipped to manage their resources and deliver devolved services in a more effective and sustainable way.

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