A Political Economy

Analysis of Devolution

in Kenya

Prepared by: Asmaa El Messnaoui, Dorcas Omowole, Loyce

Mrewa, Rhea Fe Silvosa 

IN PARTNERSHIP WITH

INSTITUTE OF ECONOMIC AFFAIRS

2018

2

We would like to thank everyone who helped us with this report for their time and effort. On top of the list is our mentor and advisor Ann Mische, whose constant support, engagement and encouragement were vital to carry out the whole project, thank you Ann. We are also grateful to Kwame Owino, the CEO of our partner organization, the Institute of Economic Affairs (IEA), Chrispine Oduor and Cosmas Tabuche from the Futures team (IEA) and also Stephen Jairo, IEA Programme Officer, for their accompaniment, mentorship and valuable reviews of our work. Our gratitude expands to all IEA staff in fact, especially the administration and logistics team.

Special thanks go also to our I-Lab professors and mentors who made this whole adventure a smooth learning process. Professor Tracy Kijewski-Correa and Professor Steve Reifenberg. We extend our gratitude to Mark Stevens for all his valuable help in editing this report. Finally, to the whole team that facilitated the logistical side of our fieldwork; from the United States, Andrew Petrisin, Jennifer Krauser, and Hermalena Powell, and from Kenya, Jackline Oluoch-Aridi, Cindy Mical, and all Notre Dame Alumni, thank you all.

The Institute of Economic Affairs (IEA) is a leading think tank in Nairobi, Kenya conducting research underpinned by the need to comprehend and analyze citizen perspectives and generate insights that inform and guide public policy. IEA has taken remarkable strides in ensuring community engagement and participation on pertinent development and governance issues in Kenya.

3

Contents Executive Summary ...................................................................................................................................... 5

Glossary ........................................................................................................................................................ 6

1. Background and Problem Statement .................................................................................................... 7

2. Research Methodology and Target Audience ........................................................................................... 8

3. Findings ..................................................................................................................................................... 9

3.1 Public Service Delivery and Development Outcomes ......................................................................... 9

3.2. Revenue Allocation and Inter-Governmental Relations .................................................................. 13

3.3. Inclusion, Public Participation and Role of Civil Society .................................................................. 14

3.4. Expectations for Devolution and Possible Scenarios ....................................................................... 20

4. Recommendations .................................................................................................................................. 21

5. Conclusions ............................................................................................................................................. 26

Appendix A: Background and Methodology ............................................................................................... 28

A.1. Background and Problem Statement .............................................................................................. 28

A.2. Context............................................................................................................................................. 29

A.3. Stakeholders in Kenya’s Devolved Government .............................................................................. 34

Appendix B: Objectives and Methodology ................................................................................................. 40

B.1. Study Areas ...................................................................................................................................... 40

Appendix C: Public Service Delivery and Development Outcomes ............................................................ 42

C.1. Roles and Responsibilities between County and National Governments ....................................... 42

C.2. County Obligations ........................................................................................................................... 42

C.3. Values and Principles of Public Service ............................................................................................ 43

C.4. Positive Devolution Outcomes, Impacts, Constraints ...................................................................... 43

C.5. Drawbacks and Challenges of Implementing Devolution ................................................................ 44

C.6. SWOT Analysis ................................................................................................................................. 46

Appendix D. Revenue Allocation and Inter-Governmental Relations ........................................................ 47

D.1. Issue 1: Delayed Approval of Audited Accounts .............................................................................. 47

D.2. Issue 2: Delayed Disbursement of Funds to Counties ..................................................................... 48

D.3. Stakeholder Tension over Revenue Distribution ............................................................................. 48

D.4. Revenue Sharing among Counties ................................................................................................... 49

D.5. Concerns with Internally-Generated Revenue Sources ................................................................... 50

D.6. SWOT Analysis ................................................................................................................................. 51

Appendix E: Inclusion, Public Participation and Role of Civil Society ......................................................... 52

4

E.1. Public Participation: Balancing Constitutional and Lived Realities .................................................. 52

E.2. Inclusion and Social Integration ....................................................................................................... 55

E.3. Civil Society and the Shrinking Democratic Space ........................................................................... 57

E.4. SWOT Analysis .................................................................................................................................. 59

Appendix F. Expectations for Devolution and Possible Future Scenarios .................................................. 61

F.1. Reasons for Optimism or Pessimism about the Future of Devolution ............................................ 61

F.2. Possible Future Scenarios................................................................................................................. 64

Appendix G: Recommendations ................................................................................................................. 66

G.1. Public Service Delivery and Development Outcomes ..................................................................... 66

G.2. Revenue Allocation and Inter-Governmental Relations .................................................................. 68

G3. Inclusion, Public Participation and Role of Civil Society ................................................................... 68

5

The promises of devolution as enshrined in the 2010 Constitution have given many Kenyans newfound hope and optimism for the future of the country. Coming from a history of centralized-unitary rule, many Kenyans have hailed devolution as the remedy that would transform the ways the Kenyan government manages and governs its resources, as well as its engagement with the people. Devolution has brought to the forefront issues of equitable distribution of resources, wider public participation, reduction of socio-economic disparities, national unity and integration, among others. The forty-seven county governments, largely mandated to fulfill these tasks, set out to attain these goals either with grit and innovation, or with a ‘politics as usual’ attitude. Admittedly, devolved counties face complex challenges -- ranging from resource mismanagement and limited revenue allocation to weak governance structure and pervasive corruption -- that hinder them from carrying out their constitutionally-mandated duties. Yet it cannot be denied that five years into implementation, gains have been made and changes have been felt by the common Mwananchi in the most remote corners in the country. This paper explores the diverse viewpoints of stakeholders on devolution and examines the implications of these recent changes in the micro- and macro-workings of Kenya through a political economy analysis framework. In what follows, interview results, are grouped into four thematic areas:

1. Public service delivery and development outcomes; 2. Revenue allocation and inter-governmental relations; 3. Inclusion, public participation and role of civil society; and 4. Expectations for devolution and possible future scenarios.

Key recommendations include:

• Conducting a Kenya-wide but county-specific needs assessment to identify priorities for each region while ensuring a sense of ownership for projects and empowering citizens to increase government transparency, monitor project implementation and hold stakeholders accountable to their roles and responsibilities within devolution.

• Continue to strengthen partnership between and among counties and encourage forward-thinking leadership to foster an optimistic outlook on devolution.

• Clarify roles between the counties and national government to prevent overlaps/duplication in functions and inefficient use of revenues.

• Follow best practices in the implementation of revenue allocation and public participation mechanisms.

This document was authored by a team of graduate students enrolled in the Integration Lab (i-Lab) in the Keough School of Global Affairs (KSGA) at the University of Notre Dame. This document assembles data, analyses, recommendations or guidance at the request of the Institute for Economic Affairs. As the product of an academic experience, any opinions, findings, and conclusions or recommendations expressed herein are those of the student authors and do not necessarily reflect the views of the Keough School of Global Affairs, the University of Notre Dame or the Institute for Economic Affairs

6

ADP Annual Development Plan NG-CDF National Government - Constituency Development Fund CIDP County Integrated Development Plan CSO Civil Society Organizations ECD Early Childhood Development DFRD District Focus for Rural Development strategy INGO International Non-Governmental Organizations ITGRTC Inter-Governmental Relations and Technical Committee CRA Commission on Revenue Allocation LA Local Authority LASDAP Local Authorities Service Delivery Action Plans LATF Local Authority Transfer Fund MCA Member of County Assembly NGO Non-Governmental Organization NCIC National Commission on Integration and Cohesion NGEC National Gender and Equality Commission OGP Open Government Partnership KLGRP Kenya Local Government Reform Programme KLRC Kenya Law Review Commission KNCHR Kenya National Commission on Human Rights KLRGP Kenya Local Government Reform Programme

7

1. Background and Problem Statement

“Devolution is like a breath of fresh air.” – George Ooko, Secretary, Commission on Revenue Allocation

The promulgation of the 2010 Constitution was intended to transform the prevailing socio-political arrangement in Kenya. At its heart, the Constitution aims to bring about equitable allocation of resources and greater public participation of Kenyans in the socio-political arena of the country. It “grants Kenyans enormous powers to demand good governance and accountability from their elected leaders.”1 The passage of various laws and policies such as the Public Finance Management Act of 2012 and the County Government Act of 2012 aims to protect, promote and enforce the implementation of these principles in the forty-seven counties. The new Constitution not only restructured the entire governance system in the country, it also introduced a fourth arm of government composed of Independent Offices and Commissions such as the Kenya National Commission on Human Rights (KNCHR), the National Cohesion and Integration Commission (NCIC), and the Kenyan Law Reform Commission (KNLRC), among others, that serve as a check on state’s excesses through observance of the rule of law and other democratic processes.2

Despite the focus on institutional equity and inclusion in the new Constitution, revenue allocation and public participation have been two of the most contested issues in the devolution process, generating extensive debate among various stakeholders. However, it cannot be denied that devolution has, indeed, brought the government closer to the people, not only because of the spaces provided for constituencies to actively engage in socio-political and economic decision-making, but also in the way that it has made the government ‘felt’ by the people. The presence of the first ever roads in the most remote areas of some counties, as well as the construction of health clinics and Early Childhood Development Centers (ECDC) by county governments have slowly made a difference to the lives of the Mwananchi.3 The 15% minimum threshold of national revenue allocation to counties ensured that financial resources are provided to all county governments regardless of ethnic affiliation or party alignment, while the Public Finance Management Act requires them to devote 30% of the 15% allocation to socio-economic development initiatives. The same Act mandates that county governments involve their citizenry in the planning and budgeting processes that will determine how these resources will be spent. However, only a nuanced discussion of the perspectives of diverse stakeholders can provide insights into the internal mechanisms of devolution. Civil society and development actors, county officials, and national governmental bodies have both complementing and competing views. By examining these views, this report illuminates the constraints and incentives that either hamper

1 Kivuva, J. M. (2010) Restructuring the Kenyan State. Constitution Working Paper Series No.1. Society for International Development. See: https://www.sidint.net/sites/www.sidint.net/files/docs/WP1.pdf p.9. 2 Ibid 3 This is a Kswahili term for “common people.”

8

or facilitate the attainment of the goals of devolution, resulting in a political economy analysis of devolution. This in turn enables a mapping of entry points and the opportunities as well as the challenges in improving the implementation of devolution in the future. (Appendix A.1, page 28)

2. Research Methodology and Target Audience This report is a political economy analysis of the devolution process in Kenya that aims to understand the governance and political economy factors that influence and shape its implementation. It is hoped that this understanding will contribute towards improving the devolution process, particularly the aspects related to equitable development and alleviation of ethnically-motivated conflicts. Therefore, this report:

1. Identifies and assesses the strengths, weaknesses, opportunities and threats of the current implementation of devolution in Kenya;

2. Examines the political-economic landscape of Kenya and its impacts on resource allocation;

3. Analyzes the constraints and incentives experienced by various stakeholders involved with the devolution process; and

4. Provides policy recommendations to foster pro-development and pro-peace devolution outcomes in the country.

The report is comprised of findings from primary and secondary sources. Secondary sources include reports from the Chapter 15 Commissions, as well as publications from various civil society organizations, research institutes and think tanks in Kenya. The primary research consists of individual in-depth interviews with county officials from the Departments of Civic Education, Budget & Planning and Revenue Allocation, including one Member of County Assembly (MCA). In-depth interviews were also conducted with Community-Based Organizations, Women’s Groups, Youth-Based Organizations, Non-Governmental Organizations (NGOs), and International Non-Governmental Organizations (INGOs), as well as collective interviews with different Civil Society Organizations (CSOs). An average of 10 individuals participated in each CSO collective interview. Overall, representatives of 35 civil society groups from diverse organizations across the six sites were interviewed during the study.

During the consent process, interviewees were given the option to choose preferred anonymity level:

● full anonymity (name and organization not recorded and only a pre-defined category that generally describes their role in their organization is coded)

● partial anonymity (name not recorded, but organization and generic role are recorded) ● full disclosure (name, organization, and title recorded)

Because of this reason and for coherence, reference is made to participants using a county official, CSO representative and so on. The interviews included questions on the impacts of devolution, revenue allocation, inclusion, public participation, intergovernmental relations and specific questions based on the mandate of the commissions. These interviews were conducted

9

in Baringo, Elgeyo Marakwet, Kisumu, Machakos, Mombasa and Nairobi counties between 4 June 2018 and 13 July 2018. The targeted audience of this work is all the stakeholders of the devolution process, mapped in Table 1. (See Appendix A.2, page 29) Table 2.1: Map of Kenyan Devolution Stakeholders Engaged

Interest

Low High

Influ

ence

or p

ower

High

● National Government ● National Commissions and Independent

Offices ● International Donors/NGOs

Low

● County Government ● Civil Society Actors/ Community Based

Organizations (including faith-based organizations)

● Citizens

3. Findings While devolution may have fallen short of public expectations and has not yet completely fulfilled its promises as per the Constitution, the majority of the respondents preferred this form of governance over a return to a centralized form of government. This is mainly because devolution gives people hope, and they feel empowered to manage their own affairs and make decisions about their future. In what follows, results from interviews are presented, grouped into four thematic areas:

1. Public service delivery and development outcomes; 2. Revenue allocation and inter-governmental relations; 3. Inclusion, public participation and role of civil society; and 4. Expectations for devolution and possible future scenarios for devolution

3.1 Public Service Delivery and Development Outcomes

“Where we are, is better than where we started from and this gives us hope that we are heading somewhere better”

- Baringo County Official. Devolution is the transfer of responsibility over functions as well as the sharing of responsibilities between the national and county government (Appendix C.1, page 42). County governments have public service obligations as per the County Governments Act, No. 17 of 2012, which outlines measures that would ensure the realization of the public service obligations (Appendix

10

C.2, page 42), including the values and principles (Appendix C.3, page 43), stipulated within the Constitution of Kenya.4 The fruits of devolution are experienced at varying levels among counties within Kenya. Devolution has led to infrastructural developments, improved service delivery and the drafting of development plans that are more localized. Devolution has enabled the development of counties that were previously marginalized, including rural areas that were severely underdeveloped; the merits of devolution are most visible in these areas. Additionally, public services have now become more accessible to the residents of counties due to subsidiarity and local control and management brought about by the devolution process. Accessibility and proximity enable residents to engage with their representatives and policy implementers and provide a platform for petitioning/lobbying for their most pressing needs and the implementation of services. Development and improvement in services has, according to CSOs, motivated residents to be tax compliant (Appendix C.4, page 43). However, the gains of devolution have not been consistently implemented in all counties. There are also challenges within counties that were described as doing well. Additionally, development has stifled/stalled in a number of counties due to limited public participation opportunities and elite capture, leading to low inputs into County Integrated Development Plans (CIDP). Corruption and misappropriation of funds were also cited as limitations on potential service delivery and development gains. Lack of cooperation between the national and county governments has translated into delays in procurement that have led to subsequent project implementation suspension or deferment (Appendix C.5, page 44).

4 Part VIII of the County Government Act, No. 17 of 2012.

11

12

13

3.2. Revenue Allocation and Inter-Governmental Relations Fiscal devolution has been described by many as the major breakthrough that the national decentralization system has brought to Kenya. The public finance provisions in the 2010 Constitution were significantly influenced by the need to correct past executive excesses and abuses. Article 202 provides for equitable sharing of national revenue between the national and county governments. Equity has been defined in the Constitution broadly through the mention of a 15% minimum threshold to be disbursed to the 47 counties. It was left to political compromises reached by the stakeholders to decide on the specific percentages to be devolved.

The reallocation of funding to the counties has allowed national revenue to trickle down to areas and places, even below the county level, that had never benefited from development projects. It remains, however, a source of intense debate, as various stakeholders have different and sometimes opposing viewpoints on the amount to be devolved and the way resource allocation should be carried out. The amounts approved by Parliament have been around 30% since fiscal devolution came into effect. The counties believe it should be at least 50% because the responsibilities devolved to them are more than half the duties assigned to the national government previously. The Commission on Revenue Allocation is in charge of determining the revenue sharing formula among counties, subject to revision each five years. This formula also sparks controversy among rural and urban counties with regard to the distribution necessary to realize equity.

In addition, several technical issues surrounding the revenue allocation process add to the challenges that stand in the way of a smooth disbursement of funds to counties. Two major challenges identified by respondents were related to the basing of county funding shares on audited accounts of the national budget that date back a number of years, and the serious delays in the counties’ receipt of the money. Since the implementation of fiscal devolution, this has led to counties receiving less than the proportion that they would have received if the audited accounts had been done in a timely fashion. Although, the national budget has been increasing each year, the counties did not benefit from this as they always got their share based on old audited accounts.

This has repercussions for the credibility of county governments, for the work of county assemblies, and for the progress of development in counties. “We have lost as a county, major strong contractors because they're not paid on time,” recalled the revenue allocation officer of Baringo county. It also calls into question the worth of public participation in budgeting for money that has no specific timeframe in which to reach the counties.

Apparently, those challenges that hinder a seamless flow of revenue to the counties are due to what the Chief Executive Officer (CEO) of the Kenya Law Reform Commission refers to as “supremacy battles” between the two levels of government and also between the executive and the legislative at each level. Overall, fiscal devolution is perceived unanimously in a positive light across Kenya by all stakeholders engaged. Because of the challenges of implementation, conflicting positions have been expressed by stakeholders which mirror the complexities of revenue allocation as a political economy issue subject to compromises as it continues to transform in its bid to meet the needs of all stakeholders. (Appendix D, page 47)

14

15

16

3.3. Inclusion, Public Participation and Role of Civil Society

“I think, as of now, people are aware that they need to participate. But there are still challenges around access to information, especially access to information to enable them to effectively

engage and participate.”

- CSO, Nairobi County

The advent of the 2010 Constitution aimed to confer sovereign power back to the people of Kenya by fostering public participation in decision-making at all levels. Several provisions were included to protect and promote the involvement of marginalized and minority groups in various political processes. One such example is the requirement that “not more than two thirds of the members of elective or appointed bodies shall be of the same gender” (Article 27:8, 2010 Kenyan Constitution), which ensured women’s representation within the present government political structure. Public participation, therefore, became a constitutionally-protected right for all citizens and “one of the national values and principles of governance in the country.”

Interviews conducted with various stakeholders from civil society, as well as county and national governments positively affirmed this new institutional arrangement and how it brought the government closer to the people. In the words of one of the focus group participants in Kisumu,

“with the coming of devolution, the idea of public participation has really empowered the people that they can decide their own destiny and discuss what they want to do for themselves.” Consequently, respondents’ appreciation for the opportunities that the devolved form of governance has opened up, in terms of democratic spaces for civic engagement, was unanimous.

While more work is still needed in the area of civic education, the majority of those interviewed were cognizant of the legal measures undertaken to institutionalize public participation in government processes, particularly in the area of planning and budgeting. This is not surprising given that those that were interviewed are key stakeholders with vested interests in the success or failure of devolution. The Public Finance Management Act (2012) and the County Government Act (2012) were two of the most quoted legislative policies in the interviews. These, they asserted, enforced public participation and provided mechanisms for public engagement. With the Public Finance Management Act (PFM), participation occurs within the two levels of government: national and county. At the national level, the PFM Act stipulated that offices involved in the various budgetary processes shall include public participation in the dispense of their functions. However, it was not clear how public participation should come about at the national level.

17

On the other hand, various civil society organizations lamented that despite prevailing structures, citizen engagement remains weak and perfunctory. There is a growing concern that public participation, as implemented by most counties, is increasingly becoming merely cosmetic and is but form without substance. Most county governments used public participation as a stamp of approval for projects and interventions already decided from above. Even some county government officials admitted that public participation is not carried out in line with the various laws outlined above. For several counties, these lapses were attributed to lack of resources.

Despite the myriad laws requiring county governments to release and allow public access on documents that need to be deliberated, this continues to pose a challenge. Civil society actors complained that county governments do not proactively share information that is needed for public participation, or else they disseminate the information very late. Thick piles of budgetary and planning documents were often handed down either a day before or several hours prior to the start of the forum. The language in the documents and other forms of communication is also of particular concern for people at the village. Most documents that community members need to review are riddled in technical jargon or in a language that they are not familiar with. This situation is compounded in areas where illiteracy is high. In some counties, announcements are conveyed through radios in the local vernacular and a translator is brought along to translate during the forum, but only in instances where there are sufficient resources for these language services.

Despite the challenges and roadblocks encountered during the first five years of implementation, devolution is still seen by many as the answer to the various socio-political and economic ills besetting the country. While public participation is not entirely new in Kenya, the 2010 Constitution has afforded it a deeper meaning and conviction. People from different levels of society hold high expectations with regard to the many possibilities that public participation can contribute to ushering in a more robust Kenyan democracy. (Appendix E, page 52)

18

19

.

20

3.4. Expectations for Devolution and Possible Scenarios In a series of conditional statements, stakeholders interviewed expressed optimism about the future of devolution over the next 10-20 years. Devolution was likened to how a child learns to walk, or the beginning of a journey fraught with the normal challenges that accompany the process of adjustments or implementation. Stakeholders interviewed were hopeful that, over time, the challenges of devolution will be addressed and a devolution that works for the people will emerge. County officials were hopeful that counties would progress from executing small projects to executing larger ones. The need for collaborative projects across counties and proper management of issues that accompany them -- such as ensuring access for all counties involved – were noted so that the benefits from those projects are not eclipsed by conflicts.

CSO and county officials look forward to the sustained improvements in public service delivery. Another basis for optimism identified by respondents, especially CSOs, is the 5-year CIDP, which creates the feeling of work-in-progress as counties work towards the projects/programs in their CIDP. Hence, citizens and CSOs have something to look forward to via the realization of those projects/programs. While the 5-year CIDP was a source of optimism for some, it triggered pessimism for others. Those who see it as a source of pessimism suggested that there should be longer-term plans that are independent of the election cycle. “I'm still worried about the bracket that you have given us, the 10 to 20. The reason why I'm saying this is because we elect our leaders every 5 years. That means every 5 years we come back again and start at zero. We start burning one another, we start killing each other and then for 4 years we build again and then we come back. So we keep on going in that circle and circle” (Mombasa CSO Collective interview). Civil society leaders expressed additional rays of ambivalence and pessimism. The CSOs interviewed agree that positive outcomes will hinge on citizens’ active engagement and ability to hold leaders accountable.

A positive outlook on devolution also hinges on efficient use of resources through evidence-based planning, internally generated revenues to increase counties’ autonomy, reduction in the size of government, revenue growth (leading to more investment in grassroots projects), good laws, and political will. Public finance management laws have to be expanded and made more stringent. Monitoring and evaluation protocols need to be clear and implementable, such that the community can assess whether projects and innovations are adding value or merely parasitic. (Appendix F.1, page 61).

Revenue allocation and public participation are two pivotal factors that drive the future of devolution; while revenue allocation can be likened to the fuel, public participation can be likened to the wheels. Civic engagement coupled with an accountable and committed government represents the path to successful devolution. (Appendix F.2, page 64)

21

22

23

4. Recommendations

I. Public Service Delivery and Development Outcomes

1. Foster consultative planning at the national and county level: a. Conduct a Kenya-wide/extensive fact-finding mission to identify and prioritize

development needs across counties and projects that will result in a "structural affirmative action.”

b. Increase support for the CRA as it utilizes the Equalization Fund to reach out to areas with specific chronic problems and meet the needs of the most marginalized.

2. Encourage collaboration between counties, counties & the national government, and counties & international partners:

a. Encourage partnerships with the development community to assess the viability and social appropriateness of projects through necessary pre-project analysis, e.g. EIA and PESTLE analysis, before projects are commissioned.

b. Increase socio-economic collaboration and partnership among counties, e.g., establish regional economic blocks that can facilitate and initiate implementation of inter-county/regional projects. Such projects can enjoy the benefits of economies of scale as well as enhance unity among counties.

3. Invest in high-impact projects: a. Increase investments in high-impact projects as a priority of county government. This

could include road construction, development of energy projects and other projects identified via integrated planning that can benefit a large portion of the population and have ripple effect on other sectors through forward and backward linkages.

4. Ensure Transparency in procurement processes and project monitoring: a. Restructure the vetting and procurement process to follow the principles of

accountability and transparency. b. Regularly disseminate reports on project status to the public through mass media

(newspaper, radio) and other neutral platforms with nationwide coverage. c. Continue to empower CSOs, think tanks and communities for independent

monitoring of CIDPs.

(For more details, please refer to Appendix G.1, page 66)

24

II. Revenue Allocation and Inter-Governmental Relations

1. Establish efficient revenue collection mechanisms a. Explore opportunities and future potentials of mobile applications and mobile

payment platforms, e.g., m-pesa,5 in revenue collection.

2. Increase revenue and autonomy for the counties a. Increase revenue allocation from the national to county governments to engender

greater autonomy among the counties as an important signal of trust and commitment from the national government to the devolved system of governance.

b. Empower counties through legal and other administrative means to strengthen and increase their capacity to generate local revenues. This may include mapping out potential sectors/initiatives such as tourism and livestock/agricultural produce value-addition.

3. Fine tune parameters for revenue allocation and equalization a. Re-evaluate the criteria and guidelines used to determine revenue allocation as

well as establish and disburse the equalization fund. The criteria and guidelines should reflect current socio-economic realities of the counties so that these funds remain relevant and substantial in promoting developmental progress.

4. Clarify roles/responsibilities a. Clarify the roles and functions of national and county-level governments and create

mechanisms for making consultation more efficient and effective. This will reduce duplication, improve efficiency and enhance accountable and transparent performance of functions.

b. Assess revenue allocation to counties vis-a-vis their devolved functions and ensure that county governments have the necessary resources to fully execute their mandates.

(For more details, please refer to Appendix G.2, page 68)

5 M-PESA is a SMS-based system that enables users to deposit, send, and withdraw funds using their mobile phone. See: https://www.ifc.org/wps/wcm/connect/4e64a80049585fd9a13ab519583b6d16/tool+6.7.+case+study+-+m-pesa+kenya+.pdf?mod=ajperes

25

III. Inclusion, Public Participation and Role of Civil Society

1. Subscribe to Open Government Partnership a. Counties in Kenya, in the spirit of transparency and proactivity, need to ensure

adequate and timely access to information for citizens and civil society. Although Kenya as a country has subscribed to the Open Government Partnership6 (OGP), just as Elgeyo Marakwet and other counties have, all counties in Kenya should do same. OGP governments demonstrate commitment to open government in four critical areas: fiscal transparency, access to information, asset disclosure and citizen engagement, measured by objective indicators and validated by independent experts.

b. In addition to this, county governments should update their websites promptly and utilize internet and other mass media platforms (for example, Television and radio shows) to ensure that information on their activities and plans are available and accessible.

2. Search for a more valid and inclusive means of public participation a. Public Participation Forums are fraught with perennial and intractable issues, such

as issues of elite capture, limited by number of participants, financial constraints, and technical/language barriers, which bring to question its value and inclusivity. Independent research INGOs and development partners targeted towards citizens and technocrats, either to support or replace Public Participation Forums, should be the basis to identify and prioritize needs of counties.

3. Augment efforts of CSOs through civic education in facilitating good governance a. CSOs should be viewed as development partners and a bridge between citizens

and the government. Rather than clamping down on CSO activities, CSOs should be given more room to operate and facilitate their efforts in civic education. CSOs should have non-restrictive guidelines for operations and feedback mechanisms for communication reasons why CSOs requests are not granted instituted.

b. Establish clear frameworks of engagement between stakeholders like CSOs and citizens exacting accountability with county governments as a means to promoting partnership ensuring accountability in the management of public resources and the delivery of public services. National and county governments should have policies on social audit. Engagement in most instances has been ad-hoc.

(For more details, please refer to Appendix G.3, page 68)

6 See: https://www.opengovpartnership.org/about/about-ogp/how-it-works

26

5. Conclusions This report on the political economy of devolution has focused on development outcomes, revenue allocation, intergovernmental relations and public participation. In this way, the report addresses some of the root causes of conflict within Kenya, as well as the reasons for the initial drive for devolution in the aftermath of the 2007/2008 post-electoral violence. As the Kenyan experience shows, inequality in economic conditions can result in agitation by marginalized groups and the desire of these groups to control political power in order to channel economic benefits to their people or locations. By granting some autonomy and resources to counties, devolution seeks to temper these agitations.

We agree with the county official interviewed in Elgeyo Marakwet who argued that, irrespective of devolution, the basic parameters for any government system to serve its people and avoid conflicts lies in its ability to manage people, manage resources and ensure transparency, while being committed to best practices in terms of governance. The elements of best practice include (i) participation, communication and feedback, (ii) collaboration in planning, and (iii) transparent budgeting. Irrespective of devolution, these are the standards for Kenya to strive towards.

The calls by civil society organizations for managers, not politicians, also echoes this point. Managers are committed to planning and collective progress. Managers are vested in those projects that have ripple effects or linkage to benefits and that are sustainable. In contrast, politicians seek to create a name for themselves and engage in capital-intensive projects that become obsolete when they leave office. This situation was described in Kisumu CSO collective interviews as, “development for the sake of development, but no development at all”. These short-lived benefits create a series of highs and lows, along with the potential risks that people lose faith in the devolution process.

The potential for the Kenyan devolution to achieve its objectives as identified in the 2010 Constitution hinges on visionary and proactive leadership at the national and county levels, in the independent commissions and by civil society. This will happen when stakeholder roles are acknowledged, and systems of implementation clarified. The international development community can support devolution in Kenya by ensuring coordination and oversight that is objective and technically competent for planning and revenue allocation, as well as by enforcing appropriate checks and balances built into the Kenyan devolved structure. This will help avoid a situation of ‘a devolution for the sake of devolution and no devolution at all,’ and its attendant potential challenges.

27

28

Appendix A: Background and Methodology A.1. Background and Problem Statement This report explores diverse stakeholder viewpoints on devolution and examines the implications of these recent changes in the micro and macro-workings of Kenya through a political economy analysis framework (Figure A.1). According to OECD-DAC, political economy analysis or PEA ‘is concerned with the interaction of political and economic processes in a society: the distribution of power and wealth between different groups and individuals, and the processes that create, sustain and transform these relationships over time.”7

Figure A.1: Layers and Key Aspects of Problem-Driven Political Economy Analysis

This definition draws particular attention to politics, understood in terms of contestation and bargaining between interest groups with competing claims over rights and resources. The OECD-DAC definition is equally concerned with the economic processes that generate wealth and that influence how political choices are made. These processes are closely interrelated and part of a unified set of dynamics that influence development outcomes.8 An understanding of the political economy of devolution is important in uncovering the role it plays, not only in affecting development outcomes, but in shaping policies and the way these are implemented. PEA also provides an analysis of the power structure that underlies every governance and economic system operating in a particular society. Thus, this analysis can “support more politically feasible

7 DFID, 2009. Political Economy Analysis - How to Note. A DFID practice paper https://www.odi.org/sites/odi.org.uk/files/odi-assets/events-documents/3501.pdf

8 Ibid, p. 4

29

and therefore more effective development strategies by setting realistic expectations of what can be achieved, over what timescale, and the risks involved.”9

It must be noted that this type of analysis is not a panacea for the myriad issues besetting development, or for the challenges that are currently being experienced in the implementation of devolution. Nevertheless, this does not eliminate its relevance in informing policy strategy and maximizing the ‘window of opportunity’ that devolution presents to the country.

A.2. Context

“Everything is political, even budgeting and planning is political. It is only the politicians at the top who can enforce...who can say let's observe the law because we have good laws.”

– Senior Economist, Baringo County

The previous system of governance in Kenya was characterized by a lack of involvement of citizens in the political decision-making process, and their subsequent ineffectiveness in bringing the government to account.10 When the country gained independence in 1963, the post-colonial Kenyan government adopted many of the structures and institutions inherited from the colonial administration. A quasi-federal system of government was instituted between 1963 and 1964 (also known as Majimbo). This system of government instituted regional government with mandates that required financial allocations to implement. However, a series of constitutional amendments ensued which contributed to the consolidation of power at the hands of the executive.11 These constitutional interventions led to what was then called the ‘imperial presidency,’ an imbalance of power which granted the executive arm of the government excessive legitimate power and authority to the detriment of the legislative and judiciary branches of government.12 “The consolidation of powers entrenched by Kenya’s post-colonial rulers has been blamed for the deterioration of ethical standards in the public service,”13 as it rendered institutions with oversight roles powerless while those that can exercise them were too intimidated to perform such functions. Moreover, such institutional arrangements have led to socio-economic disparities and political marginalization of certain groups and regions not allied to those in power, as development and government postings were subject to the arbitrary power of the presidential office, which to date is a key source of tension and conflict.14

9 Mcloughlin, C. (2014). Political Economy Analysis: Topic Guide (2nd Ed.) Birmingham, UK: GSDRC, University of Birmingham

10 Conrad B., Yash Pal G., and Jill Cottrell G (Eds). (2015). Understanding Devolution. Katiba Institute. Nairobi, Kenya. p. 10

11 Kivuva, J. M. (2010) Restructuring the Kenyan State. Constitution Working Paper Series No.1. Society for International Development. https://www.sidint.net/sites/www.sidint.net/files/docs/WP1.pdf p. 3-5 12 Ibid. p. 3-5 13 Mbai, O. C. (2003). Public service accountability and governance in Kenya since independence. African Political Science. 8 (1) 113 - 145. As quoted by Bagaka, O. Restructuring the Provincial Administration: An Insider’s View. Constitution Working Paper No. 3, Society for International Development. page 3. http://sidint.net/docs/WP3.pdf 14 Friedrich-Ebert-Stiftung. (2012). Regional Disparities and Marginalization in Kenya. Nairobi, Kenya, p. 11.

30

Redistribution was not a priority of the Kenyatta government--the first Kenyan independent government that ascended to power after the British left the country--which focused more on economic growth and development that benefited a fairly small number of elites and communities.15 When Moi became president, he introduced a number of distributive policies to address marginalization and cater to minority groups which were left out of the previous government.16 He established the District Focus for Rural Development strategy (DFRD) in 1983, which was operational until 1989, with the aim of ‘broadening the base of rural development and encourage local initiatives in order to improve problem identification, resources mobilization and project implementation.”17 It was, arguably, the first initiative with the intent of ‘bringing the government closer to the people.’18 Studies conducted to assess the efficacy of this initiative, however, pointed out that the ‘District Focus is merely centralization in disguise’ as its autonomy was already compromised from the very start. Budgetary resources and decisions over plans remained with the Ministries, which were under the Office of the President, not to mention other structural gaps that hinder the District from fulfilling its mandate.19 Questions were also raised if this strategy was just another ploy to benefit and favor Moi’s community as other areas remained marginalized and development were more concentrated in the Rift Valley which was his province.20

Prior to and even after independence, Kenyans have continuously agitated for decentralization of power that would enable some forms of local autonomy, which can further translate to local development. Yet, a historical review of the country’s government structure revealed that Kenya had a significant decentralized public sector in the form of Local Authorities (LAs) or the local government system, which can be traced back to colonial times.21 Admittedly, the subsequent adoption and the role of the LAs in the post-colonial Kenyan state was contentious because of how the colonial government used it as a tool of dominion and control. Kenya “inherited a local government system that was not designed with community needs in mind,”22 as it was mainly administrative and regulatory. Also, the prevailing preference of most African states, Kenya included, in instituting a centralized form of government, post-colonialism, limited the functions of the LAs.23 The local authorities mostly carried-out tasks delegated by the central government which usually comprised of public service delivery (primary education, health care, roads, etc.)

15 Ibid., p. 12-13 16 Ibid., p. 14 17 Ibid., p. 15 18 Ibid. p. 15 19 Ibid. See also: Rutten, Marcel M.E.M. (1990). The District Focus Policy for Rural Development in Kenya: The Decentralization of Planning and Implementation, 1983-9. In Simon, D. (Ed.). Third World Regional Development: A Reappraisal. Paul Chapman Publishers, London. p. 154-171. 20 Friedrich-Ebert-Stiftung. (2012). Regional Disparities and Marginalization in Kenya. Nairobi, Kenya. p. 15. 21 Ndii, David. (September 2010). Decentralization in Kenya: Background Note. Accessed at: http://siteresources.worldbank.org/INTAFRICA/Resources/257994-1335471959878/Decentralization_in_Kenya_Background_Note.pdf p. 3. 22 Institute of Policy Analysis and Research (2010), Reforming Local Authorities for Better Service Delivery in Developing Countries: Lessons from Rural Poverty Reduction and Local Government Support Programme (RPRLGSP) in Kenya. Edited by Tiberius Barasa and Wim Eising. p. 16. 23 Ibid, p. 16.

31

for their respective jurisdiction.24 In addition, succeeding governments enacted policies that further undermined and curtailed the autonomy of LAs in service delivery including their ability to raise local revenues. Despite the various reforms instituted to improve and strengthen local governance, such as the Local Government Act Cap. 265 of the laws of Kenya (1978) and the Local Authorities Services Charge Act (1988), these failed to address issues of centralized decisions over resources and development, a bloated bureaucracy that was also under-capacitated, and most importantly, inclusion to the Constitution which could safeguard LAs from manipulations and arbitrary interventions from the Minister of Local Governance, among others.25

In 1996, the Kenya Local Government Reform Programme (KLGRP) was established following an inquiry on LAs operations conducted in 1995. “Its objective was to restructure the local public sector, improve local public expenditure management and strengthen local-level accountability mechanisms.”26 It was through this initiative that the Local Authority Transfer Fund (LATF) Act and subsequently the Local Authorities Service Delivery Action Plans (LASDAP) were introduced in 1998. The Act created the LATF which constitutes 5% tax of all revenues collected under the Income Tax Act, which significantly improved the ability of the LAs to manage and collect local revenues as well as identify and implement development projects in consultation with their respective communities. While these initiatives were able to rejuvenate LAs relevance in local governance, various challenges and problems continued to beset LAs and undermine their effective implementation. These included funds spent more on recurrent costs, lack of monitoring and evaluation to track utilization of funds, limited technical capacity among staff, and weak or non-involvement of communities in planning processes.27

The introduction of the Constituency Development Fund (CDF) Act in 2003 aimed to further aid local development and enhance direct community engagement in decision-making processes pertaining to development initiatives. It was allocated with substantial funding, which was a minimum of 2.5 percent of the government’s revenue, for grassroots development and the reduction of poverty.28 While experiences of how the CDF is utilized are different from county to county, it has fared comparatively better than other devolved funds. It was noted to be more participatory and has better public oversight due to its popularity among the constituents.29 On the other hand, several studies have pointed out that, in most counties, the CDF actually undermined local autonomy as the fund was heavily dictated by Members of Parliaments (MPs) and was usually not subject to local decision-making processes. The CDF Act gave MPs a lot of powers including the appointment of members of the Constituency Development Fund Committees (CDFCs). This was abused by some MPs who appointed their own cronies into the committees. The Act also stipulated that meetings be held at the village (location) level, but this

24 IEA (2010), Devolution in Kenya. Prospects, Challenges and the Future. IEA Research Paper. Series No. 24. p. 31. 25 Ibid, p. 32. 26 Oyugi, L,N. & Kibua, T.N., (2006). Planning and Budgeting at the Grassroots Level: The case of LASDAP In: Kibua, T.N. & Mwabu, G. (eds), (2008). Decentralization and Devolution in Kenya: New Approaches. Nairobi: University of Nairobi Press. As quoted by IEA (2010), Devolution in Kenya. Prospects, Challenges and the Future. IEA Research Paper. Series No. 24. p. 31 27 Ibid. Also see: Institute of Policy Analysis and Research, 2010 28 https://roggkenya.org/story-suggestions/cdfstory-use-of-constituency-development-fund/ 29 Institute of Policy Analysis and Research, 2010, p. 49-50

32

was not adhered to. The CDF have also contributed to the politicization of development funds. Thus, there is much debate about the efficacy of the CDF in achieving its purpose of local development through participatory means.30

The establishment of various devolved funds and other forms of decentralization have had mixed results in their purported aims of ‘bringing the government closer to the people.’ Experiences from various stakeholders in Kenya suggest that public service delivery and local development were informed and underpinned by political dynamics. Over the years, the transition of power from one regime to the next merely underscored this fact, as those who ascended to power merely perpetuated the same socio-political arrangement wherein resources were distributed based on ethnic and political alignment. Political party coalitions and alliances are formed (parties are usually composed of three or more ethnic groups) to guard against the consolidation of power by one ethnic group and thus the capture and funneling of resources to a single community as what happened during the Moi regime.31 However, this highlighted the reality of pervasive marginalization of certain areas and a feeling of widespread exclusion and otherness from groups who craved the opportunity to control power and the allocation of resources.

In addition to introducing a devolved system of government, some of the most significant changes brought about by the new Constitution promulgated in 2010 were the establishment of a second chamber (i.e., the House of Senate) that “not only will represent the counties but also protect the interests of counties and that of the devolved governments,” which ensured greater representation and participation of regional groups and other marginalized and minority groups in national deliberations.32 The Constitution also made substantial provisions to protect and promote the independence of the judiciary and guard it against interventions from the executive.33 Indeed, in order to dismantle and curtail the power of the ‘imperial presidency,’ both the legislative and judiciary must be strengthened and enhanced to act as check and balance, and substantiate the country’s democratic culture.

Whereas the previous Constitution empowered a centralized unitary government where certain departments and services were either decentralized or deconcentrated but still within a centralized system, the devolved system of government provided for by the 2010 Constitution granted the 47 county governments shown in Figure A.2 full executive, financial and legislative powers and independence to run and manage their affairs.34 Within this framework, several administrative and governance structures where put in place to help county governments fulfill their mandates. The County Governments Act of 2012 created different levels of governance as well as allowed the county government to further decentralize its functions and services below

30 See Institute of Policy Analysis and Research, 2010. Also: David Muriuki Ngiri, Wycliffe Misuko Nyaribo. Effect of Constituency Development Fund on Socio-economic Development in Mbeere South Constituency, Kenya. International Journal of Economics, Finance and Management Sciences. Vol. 4, No. 4, 2016. p. 182-189. 31 Ajulu, Rok. (23 September 1998). Kenya’s 1997 Elections: Making Sense of the Transition Process. New England Journal of Public Policy, Vol. 14, Issue 1, Article 5. 32 Ibid. p. 14 33 See 2010 Constitution of Kenya, Articles 160, 164-165, 171, 173 (1), (3), and (4). 34 Kivuva, J. M. (2010) Restructuring the Kenyan State. Constitution Working Paper Series No.1. Society for International Development. https://www.sidint.net/sites/www.sidint.net/files/docs/WP1.pdf p. 17-18

33

the village with the approval of the county assembly.35 “Every county government shall decentralize its functions and the provision of its services to the extent that it is efficient and practicable to do so” (Article 176 (2) of the Kenyan Constitution).

The following levels of governance are provided for by the County Government Act (2012):

● County level headed by the Governor. ● Sub-County level which is the same as the parliamentary constituency, headed by a

Sub-County Administrator, appointed by the Governor and approved by the County Assembly.

● Ward level, which is represented by an elected Member of the County Assembly (MCA) and headed by a Ward Administrator appointed by the Governor and approved by the County Assembly.

● Village level headed by a Village Administrator appointed by the Governor and approved by the County Assembly. There also is a Village Council appointed by the Governor through the Village Administrator and approved by the County Assembly.

It has to be noted, however, that existing units of governance such as the Local Government Authorities and the Provincial Administrations are still in place. While the latter will be restructured, it is unclear what will happen to the former including other administrative units of government like the districts.36 If left unresolved, the presence of these parallel structures may likely hinder effective and efficient implementation of devolution and all that this entails.

In rural areas (villages) with village administrators, village administrators organize barazas37to discuss and decide on development projects that would benefit and address the needs of their communities. Some villages do not have village administrators and the counties cite inadequate resources to hire them. In the past, decisions on how best to meet the needs of the community were made at the national government level, without the participation of people from the community. With devolution, citizens’ voices should, at least in principle, be heard and valued, and inform the plans and actions of county governments. Many civil society actors, on the other hand, contend that public participation is not living up to its purposes. The issues of representation and inclusion in various public participation forums organized at the village or ward level also call into question the authenticity of this process. In many instances, women, youth, minorities and marginalized groups are left out or sidelined from engaging in these forums. Some advocates have even accused Member of County Assemblies (MCAs) - politicians - of exploiting this space for politicking and capturing the discussions to forward their personal agendas.

35 http://www.fes-kenya.org/media/publications/Devolution%20Booklet%20for%20web.pdf 36 Kivuva, J. M. (2010) Restructuring the Kenyan State. Constitution Working Paper Series No.1. Society for International Development. https://www.sidint.net/sites/www.sidint.net/files/docs/WP1.pdf p. 20 37 Baraza is a Kswahili term for “meeting/gathering.” It is also a traditional form of community gathering where members discuss issues that concerns the community.

34

Figure A.2: A map of Kenya showing the 47 counties under the devolved structure (Source: http://www.igrtc.go.ke/index.php/2016-02-22-04-01-26/resources)

From their perspective, county officials assert that the 15% revenue allocation is insufficient compared to the costs incurred in fulfilling their devolved functions. Both civil society and county officials in rural areas agree that the criteria derived to calculate this percentage disadvantage rural communities, particularly as these criteria place greater emphasis on population size. In addition, most counties lack the needed structure and capacity to generate local revenues to augment their share of the national budget. Delays in the distribution of the allocation and the bureaucracy of the national government were cited as some of the reasons for the inefficiencies of the county governments in serving their people. Even the challenges besetting public participation were attributed to limited resources and manpower in some instances. Actors at the national level, however, hold the view that the sharing scheme is reasonable for ensuring that resources are put to good use and restricted from being ‘eaten’ by local politicians.

A.3. Stakeholders in Kenya’s Devolved Government This section summarizes the key stakeholders in Kenya’s devolved government, with the relationship between some of these stakeholders visualized in Figure A.3.

35

Figure A.3: Structure and System of Devolved Governance in Kenya

● National government: ○ The executive: It is common knowledge in Kenya that the current administration

did not support the establishment of the 2010 Constitution. Thus, many stakeholders, CSOs and even some politicians included, perceived the executive as trying to sabotage the devolution process by burdening counties with responsibilities and not giving them adequate resources to perform their mandates. On the other hand, many in the national government are of the opinion that counties need some monitoring and testing to establish what they can handle before they are entrusted with more tasks and resources. Some are also of the opinion that the present administration is in support of devolution and intends to make this process successful as part of its governmental legacy.

○ The Parliament/National Assembly: The new Constitution has expanded the National Assembly from 210 to 349, which included district (constituencies) representatives, provided 47 seats to women and 12 nominated seats carved out for special interest groups such as youth, persons with disabilities and other marginalized and minority groups. The National Assembly not only serves as a check and balance against the executive, but it is also mandated to promote representation of various regional and ethno-political groups in the country. It is charged to enact legislations, determine allocation of revenue between levels of Government, oversee national revenue and expenditures, among others. Within the context of this study, the importance of the National Assembly lies in its power to approve the increase or decrease of the allocation of resources between the national and county governments (vertical). This also includes approving

36

amendments in relation to the revenue sharing formula among counties (horizontal). Many CSOs including county officials posit that increasing the revenue allocation is a move that is counter to the interest of the National Assembly and one which many members of parliament will not support as this entails a loss of political power and influence by enabling greater autonomy among counties.

○ The Senate: The new Constitution established the Senate as the second chamber in Kenya’s governance structure mandated to represent the counties and protect their interests including that of the devolved governments. It consists of 47 senators elected directly from the 47 counties across the country with provisions for 20 additional seats allocated for special interest groups (youths, persons with disabilities, and women) which are chosen from party lists according to the number of county seats each party has in the Senate. The Senate determines the allocation of national revenue among counties and ensures that appropriate funds are allocated by the National Assembly to the counties.38 As the Senate was created with explicit pro-devolution provisions, many stakeholders perceived them as supportive of the success of devolution.

○ Office of Budget/the Controller of Budget: The Controller of Budget (CoB) approves the release of money from all public funds. The CoB is required to report, every four months, to both county assemblies and Parliament, on budget execution, ensuring timely audit of accounts which form the basis of the minimum 15% allocation of revenue to counties.

● National Commissions and Independent Offices: There are 10 National Commissions and 2 Independent Agencies established under Chapter 15 of the 2010 Kenyan Constitution whose constitutional mandate is to “protect the sovereignty of the people, secure the observance by all State organs of democratic values and principles, and promote constitutionalism.”39 Furthermore, the Constitution made explicit provisions outlining their independence from other arms of government as well as ensure that they are financially and administratively autonomous from the executive, legislative and the judiciary.40 While these commissions and offices have disparate functions, each of these, in one way or another, will contribute to how effective and successful the implementation

38 See: https://www.epickenyan.com/role-of-the-senate-in-kenya/ 39 Omollo, Justus. (11 August 2014) The Fourth Arm of Government? Commissions and Independent Offices in Kenya, p. 2. 40 Sihanya, Ben. (20 November 2013). Constitutional Commissions in Kenya: Experiences, Challenges and Lessons. A Paper presented at a Conference on State Implementation of the Constitution Since 2010. Accessed at: http://www.fes-kenya.org/media/publications/Constitutional%20Commissions%20-%20Prof.%20Ben%20Sihanya.pdf

37

of devolution will be. See Box A.1 for a full listing of the National Commissions and Independent Offices.

Box A.1: Chapter XV Commissions and Independent Offices

Commissions: ● Kenya National Human Rights and Equality Commission ● National Land Commission ● Independent Electoral and Boundaries Commission ● Parliamentary Service Commission ● Judicial Service Commission ● Commission on Revenue Allocation ● Public Service Commission ● Salaries and Remuneration Commission ● Teachers Service Commission ● National Police Service Commission

Independent offices:

● Auditor-General ● Controller of Budget

In addition to these, there are other offices that were created by an Act of Parliament in order to assist in the transition and implementation of a devolved system of governance, including the values and principles implied and expressed by the 2010 Constitution:

○ The Inter-Governmental Relations and Technical Committee: enables a platform for cooperation and coordination between the national and county governments41 through the holding of forums and summits and other such avenues provided for by the Intergovernmental Act of 2012.

○ Kenyan Law Reform Commission: reconstituted under the Kenya Law Reform Commission Act of 2013, this commission ensures that any law reform initiated (by national or county government) must abide by the letter and spirit of the new Constitution. They provide technical assistance and are afforded the freedom to advise both the national and county government to perform reviews and/or reforms of existing laws as well as conduct comparative research on law reform, among other functions.42

○ National Gender and Equality Commission ○ National Cohesion and Integration Commission ○ Ethics and Anti-Corruption Commission

● County Government: consists of various officials among which are officers in charge of Planning, Budget, and Public Participation. Some of these officials were

41 See: http://www.igrtc.go.ke/ 42 See complete mandates here: http://www.klrc.go.ke/index.php/about-klrc/mandate-and-methods-of-work

38

appointed/redeployed from the national government. The constitution also stipulates that 30% of county staff must be from other counties.

○ The County Assembly: is composed of representatives elected from wards for a term of five years. There are a total of 1,450 county wards across the country. The number of county wards ranges from 85 (Nairobi county) to 10 (Lamu county) although the County Government Act sets the minimum at 15. In addition to the ward members, there are as many “gender representatives,” as are required to ensure that there are no more than two-thirds of the same gender in the assembly. These were taken from party lists, in proportion to the number of ward seats parties had obtained. In addition, each county assembly has four members to represent youth and persons with disability (the law limits them to these groups, though the constitution used the broader expression “marginalized groups”). The County Assembly has the responsibility to make laws, check the manner in which the governor and his/her ministers are carrying out executive functions, approve the county budget, approve appointments by the county, and approve borrowing by the county, among other functions.

○ The County Executive and County Administration: The County Executive is headed by the County Governor who is elected by a majority of the voters in the county - through a first past the post system.

● CBOs/CSOs (including faith-based organizations): CSOs, particularly those whose work focuses on issues of human rights, governance and accountability, often have to tread carefully in order to maintain a good relationship with both national and county governments. However, religious and faith-based organizations enjoy some clout due to the perceived apolitical nature of their work. As a society that still struggles to maintain its traditional norms and cultures, the latter organizations are somehow recognized as advocates and a bastion of the traditional moral framework of the country. Thus, they are afforded greater legitimacy, both among communities and the government, than other CSOs. The explicit bias of the new Constitution in its recognition of the sovereignty of the people in the governance of the nation implies that the country’s civil society organizations will play an important role in the realization of this stated vision. To this effect, various CSOs work in areas ranging from civic engagement, community development, youth and women empowerment, policy advocacy, and social audits to providing relevant trainings to county officials and other technical expertise in service to the county governments. For instance, several NGOs assisted in the drafting of the public participation bill among county governments. However, CSOs have attested that the space for certain forms of civic engagement is shrinking in Kenya due to the demands of balancing the democratic space and threats of terrorism, among other factors.

● Citizens (Mwananchi): Poverty and illiteracy stand as barriers to citizen engagement. Citizens have to demand good governance and accountability, but this might be a far-off goal if basic needs are not met.

39

● The International Community:

○ Development partners (donors): help implement Counties’ sustainable plans/initiatives. The Open Government Initiative is one such program that counties, like Elgeyo Marakwet, have adopted. Other initiatives were created specifically for devolution in Kenya, e.g., USAID’s Agile Harmonized Assistance for Devolved Institutions (AHADI). AHADI is a five-year USAID/DFID-funded program that commenced its support for the devolution process in 2014; the total support has been USD 50 million over a five-year period. The objectives of the AHADI program include having targeted counties provide higher quality services through improved governance; ensuring that the functionality and effectiveness of the devolved system is increased through improved intra-government engagement and cooperation; and improved representation of citizen interests and oversight of targeted county government performance. AHADI is partnering with the Council of Governors and will be supporting 22 counties: Mombasa, Lamu, Garissa, Wajir, Isiolo, Marsabit, Turkana, Meru, Tharaka Nithi, Muranga, Kiambu, Machakos, Trans-Nzoia, Nandi, Kakamega, Vihiga, Siaya, Nyamira, Kisii, Bomet, Nairobi and Mandera. The main areas of focus in these counties will include strengthening legislative and policy development processes, public financial management, public engagement and social accountability mechanisms. These also included county public service system reforms and support to effective Regional Economic Blocs.

Box A.2: The objects and principles of devolution

The Objects of Devolution (Article 174) ● Promote democratic and accountable exercise of power ● Foster national unity by recognizing diversity ● Give powers of self-governance to the people and enhance the participation of the people in the exercise of

the powers of the State and in making decisions affecting them ● Recognize the right of communities to manage their own affairs and to further their development ● Protect and promote the interests and rights of minorities and marginalized communities ● Promote social and economic development and the provision of proximate, easily accessible services

throughout Kenya ● Ensure equitable sharing of national and local resources throughout Kenya ● Facilitate the decentralization of State organs, their functions and services, from the capital of Kenya ● Enhance checks and balances and the separation of powers The Principles of Devolution (Article 175) ● County governments shall be based on democratic principles and the separation of powers ● County governments shall have reliable sources of revenue to enable them to govern and deliver services

effectively ● No more than two-thirds of the members of representative bodies in each county government shall be of the

same gender

40

Appendix B: Objectives and Methodology Indeed, a nuanced discussion of the perspectives of diverse stakeholders can provide insights into the internal mechanisms of devolution. Civil society and development actors, county officials, and national governmental bodies have both complementing and competing views about current conditions. By examining these views, the constraints and incentives that either hamper or facilitate the attainment of the goals of devolution can be revealed. This in turn enables a mapping of entry points and opportunities, as well as challenges in improving the implementation of devolution in the future.

It is acknowledged that there are limitations to the methodology adopted to produce this report, in terms of the number of interviews and the categories of stakeholders engaged (see Table B.1). Due to time constraints, interviews with County Governors and a representative number of Members of the County Assemblies (MCAs) could not be accommodated. Interactions with the National Government were limited to a few Independent Commissioners, with a focus on those who are the most centrally concerned with the aspects of devolution addressed by this report. Despite these limitations, the study provides a valuable sounding board for the observations and experiences of civil society actors working on the ground on issues related to devolution across the six counties studied. It also provides a preliminary glimpse into how these same problems are seen by country officials and independent commissioners.

B.1. Study Areas The research focuses on respondents in two rural counties (Baringo and Elgeyo Marakwet) and four urban counties (Kisumu, Machakos, Mombasa, Nairobi). The rural counties were chosen from the list of rural counties that have made leaps in development after devolution. The changes in Baringo county, for example, were palpable to the population, so the information gathered through the interviews reflected that transition and provided insights on the impact of devolution in these places. The urban counties constitute two thirds of the total urban counties of Kenya and include the biggest and most complex to assess in terms of the challenges and successes of the implementation of devolution. They are located in different regions of the country and have different issues related to the management of urban centers. As cities were incorporated into broader counties, new issues have arisen related to resource allocation between the urban centers and the rural areas attached to them within the counties.

41

Table B.1: Research Sample Size

Target Group

County

Total Rural Urban

Baringo

Elgeyo Marakwet

Kisumu

Machakos

Mombasa

Nairobi

County Official 6 3 1 10

CSO In Depth Interview

1 2 1 1 5

CSO Collective Interview

1 2 2 5

Independent Commission

3 3

Development Actor (INGO)

1 1

Total 7 4 3 2 3 5 24

42

Appendix C: Public Service Delivery and Development Outcomes C.1. Roles and Responsibilities between County and National Governments Schedule 4 of the 2010 Constitution of Kenya outlines the functions and powers assigned to each level of government. The national government has an obligation to fulfill functions in 35 areas43, while the county government has responsibility over multiple functions in 14 areas, including structural, operational & developmental functions, educational functions, and social & cultural functions.44 Structural, operational & developmental functions include: county health services, county transport (including associated tasks such as street lighting and roads), trade development and regulation, county planning and development, county public works and services, agriculture, firefighting and disaster management, implementation of national policies on natural and environmental conservation, and ensuring community participation in governance at the local level.45 Educational functions include pre-primary education, village polytechnics, home craft centers and childcare facilities.46 Social and cultural functions encompass control of air and noise pollution, cultural activities, public entertainment and public amenities, control of drugs and pornography, and animal control. 47

The Constitution of Kenya stipulates the need to “promote social and economic development and the provision of proximate, easily accessible services throughout Kenya”.48 Development and effective service delivery are therefore constitutionally protected rights, and an objective of devolution in Kenya.

C.2. County Obligations County governments are obligated to have public services within each county49 and are required to institute a County Public Service Board that educates the public and county government officials about the values and principles for effectively ensuring public service delivery.50 The County Public Service Board is also tasked with advising the county government about how to effectively ensure good public service delivery.51 This board also has the power to establish and abolish public service offices.52 It also has an obligation to investigate allegations of corruption within county public service delivery and to publish reports on implemented projects to the County Assembly and in the county Gazette, which would increase transparency in the projects implemented by the county government for furthering public service delivery.53

43 Part 1 of Schedule 4 of the Constitution of Kenya, 2010. 44 Part 2 of Schedule 4 of the Constitution of Kenya, 2010. 45 Part 2 of Schedule 4 of the Constitution of Kenya, 2010. 46 Part 2 of Schedule 4 of the Constitution of Kenya, 2010. 47 Part 2 of Schedule 4 of the Constitution of Kenya, 2010. 48 Article 174 (f) of the Constitution of Kenya, 2010. 49 Article 56 of the County Government Act, No. 17 of 2012. 50 Article 59 of the County Government Act, No. 17 of 2012. 51 Ibid. 52 Articles 61-2 of the County Government Act, No. 17 of 2012. 53 Article 59 (6) & 75 of the County Government Act, No. 17 of 2012.

43

C.3. Values and Principles of Public Service The Constitution of Kenya, stipulates the values and principles of public service within counties including: “(a) high standards of professional ethics; (b) efficient, effective and economic use of resources; (c) responsive, prompt, effective, impartial and equitable provision of services; (d) involvement of the people in the process of policy making; (e) accountability for administrative acts; (f) transparency and provision to the public of timely, accurate information; (g) subject to paragraphs (h) and (i), fair competition and merit as the basis of appointments and promotions; (h) representation of Kenya’s diverse communities; and (i) affording adequate and equal opportunities for appointment, training and advancement, at all levels of the public service, of (i) men and women; (ii) the members of all ethnic groups; and (iii) persons with disabilities.”54

C.4. Positive Devolution Outcomes, Impacts, Constraints There is evidence of positive devolution outcomes in the area of public service delivery and development. For instance, Tiaty sub-county in the rural county of Baringo had a tarmac road built for the first time. There is also improved access to water and sanitation services as well as investments in the agricultural sector, for the purpose of ensuring food security, in other parts of Baringo county. In Elgeyo Marakwet, another rural county, a county official outlined the social and economic advancements brought about by devolution, including improvements in the health indicators on maternal mortality rates, sanitation access and immunization coverage.

Additionally, respondents noted infrastructural developments, including the development of an additional 258 km stretch of tarmac road, as well as the construction of ECDCs and classrooms across the country. Political will from county government officials, the duty bearers of infrastructural and developmental change, have made these changes possible. The fulfillment of their constitutional obligations translated into positive developmental changes for residents in Baringo and Elgeyo Marakwet, where interviews were conducted.

These changes were also localized and welcomed by the community due to the consultations held with the public in designing County Integrated Development Plans (CIDP) which could have been more inclusive, but nonetheless helped with identifying the needs of the community. This is inferable from the assertions by CSOs in Baringo that devolution brings hope to citizens who are able to participate in the formulation of the CIDP and Annual Development Plans and monitor their implementation by the county government due to the increased accessibility.55 However, CSOs noted problems that are sometimes encountered within public participation forums, such as limited representation and late notice about when these forums will be held. These limitations restrict local input into developmental plans and with time could lead to fewer localized development initiatives.

Infrastructural developments have also been realized within urban counties such as Kisumu. In Kisumu County, for example, according to a county government official, additional tarmac roads have been established and the county government has invested in the agricultural sector for the

54 Article 232 of the Constitution of Kenya, 2010. 55 CSOs in Baringo stated that "Devolution brings hope to citizens" because they participate in the formulation of the CIDP and the Annual Development Plans derived from it and can follow its implementation.

44

purposes of improving food security. Additionally, this interviewee in Kisumu also discussed the social advantages realized due to infrastructural and service advancements in Kisumu, as well as in other counties. The interviewee stressed that the aforementioned advancements have created a sense of belonging among marginalized groups (an example being residents in the northeast part of Kenya). Infrastructure was considered as necessary not only for spurring economic growth, but also for increasing security. For example, a county official in Baringo stated that in order "to stamp out insecurity, you require roads, schools and electricity for schools. These require a lot of resources."

Infrastructural and service developments have therefore led to greater social justice and inclusion due to increased service delivery in some previously marginalized areas, and the inclusion of marginalized groups in discussions about development plans such as the CIDP. However, according to CSOs in Kisumu, developmental and infrastructural development has been minimal in their county. They attributed the negligible development to delays in the distribution of resources from the national government to counties, as well as bureaucratic constraints in the tendering process between these two levels of government, which in turn have hindered project implementation.

Public service providers are also more accessible due to being closer to citizens. For example, through Huduma Centres, a national government initiative launched in 2013, which houses multiple departments in one building. This is convenient and readily accessible to residents, as these services were mostly accessible only in Nairobi prior to 2013. There are 55 Huduma Centres in Kenya and they offer services such as the issuance of national identity cards, pension management, renewal of drivers license, and so on. County government officials, such as Members of the County Assembly (MCAs), Ward, and Village Administrators, are also more accessible. Accessibility of public officials was defined as supplementary to public participation forums in which residents are consulted on matters of development and budgeting (among other issues) within the county. According to CSOs in Baringo county, bringing government closer to the people has led to the empowerment of local citizens who are now able to influence the adoption of development plans, within the scope of the County Integrated Development Plan (CIDP), adapted to the local context. County officials in Baringo were also of the opinion that bringing the government closer to the people has enabled the prioritization of areas most relevant and specific to the needs of residents within the county.

An interviewee from a CSO in Baringo stated, "now that development can be seen, people can see the importance of paying taxes." However, localized development as well as proximity and accessibility need to be implemented within an effective public participation framework and within structures that promote and enable greater accountability, respectively. This would enable greater public participation and representation in the work of county governments and would also help to increase transparency that is necessary for ensuring greater accountability in the work of county government officials.

C.5. Drawbacks and Challenges of Implementing Devolution In Machakos there have been limited/minor gains and interviewees cited the lack of political will to implement the guarantees provided within the Constitution. This inaction has persisted

45

despite the alleged availability of funds and is primarily attributed to the lack of effective financial management as well as alleged misappropriation of funds.

According to CSOs in Kisumu and Machakos, residents have limited ability to influence the CIDP, including the areas that should be prioritized and addressed within the public service delivery framework, due to limited public participation opportunities. Similar sentiments have also been expressed in other counties such as Mombasa, where the county government has allegedly been taken to court over limited public participation. This lack of participation is not only unconstitutional, but with time will create a sense of apathy and disengagement with devolution and public participation forums. This will create a vicious cycle that will further limit public participation and the localization of development and services.

The revenue allocation model, where only 30% of county budgets is mandated to be allocated to development, was criticized by CSOs in Kisumu county. However, this 30% allocation is consistent with the Public Finance Management Act. The County Treasury is required to ensure that county governments allocate at least 30% of their budgets to development expenditure.56 Counties have the option to expand the revenue allocated to development, but their legal obligation is fulfilled as long as the 30% threshold is met. The perspective of CSOs in Kisumu that the 30% allocation to development is insufficient is a problem that cannot be fully negotiated between the county government and residents of Kisumu county through public participation forums because devolution has been associated with more employment at the county level and huge recurrent and maintenance expenditures.

Other challenges relate to delays in the distribution of resources from the national government to the counties and bureaucratic constraints between national and county governments in the tendering and procurement process, which have also had the effect of hindering project implementation. These challenges surface despite the constitutional obligation that stipulates the need for cooperation between the national and county government through the establishment of joint committees and authorities.57 Delays in the implementation of agricultural projects in Machakos, for instance, led to the wasting of seeds provided to farmers to boost agricultural input, since the seeds were distributed after the planting and rainy season. This in turn limited the ability of farmers to utilize the seedlings, which would become unusable during the next farming season.

Other concerns raised during the interviews related to service delivery and development include the following: inequitable revenue sharing between rural and urban counties with different capacities for development; unqualified personnel in public facilities (e.g., the use of health workers in health care centers rather than qualified nurses and doctors); duplication of tasks between the county and national government; the lack of transfer of resources to decentralized units such as wards and sub-counties, which has resulted in the marginalization of certain areas such as Kalama, in Machakos County; the politicization of project implementation in areas where politicians have support from residents; and a lack of accountability for county government

56 Article 107 (2)(b) of the Public Finance Management Act, No. 18 of 2012. 57 Article 189 of the Constitution of Kenya, 2010.

46

officials in cases where projects are not implemented. These problems manifest within counties due to both political and economic factors, including the politicization of public service delivery in certain areas.

C.6. SWOT Analysis Based on the interviews conducted in this research, the following strengths, weaknesses, opportunities and threats (SWOT) were identified in the area of public service delivery and development outcomes.

Strengths Weaknesses

● Competition between Counties ● People-driven planning ● Public service delivery in rural areas

● Newly created minorities ● County-related conflicts

Opportunities Threats

● Cooperation (Joint Projects) between counties so as to take advantage of economies of scale

● Public participation strengthened to augment needs assessment and project implementation

● Cooperation between public officers and non-state actors through social accountability initiatives

● Corruption and devolution of tribalism

47

Appendix D. Revenue Allocation and Inter-Governmental Relations D.1. Issue 1: Delayed Approval of Audited Accounts Many county actors complain that counties are routinely shortchanged in funding, since the Division Revenue Act is always based on audited reports from several years prior. The National Treasury, the Office of the Auditor General (OAG) and Parliament are the three critical agencies involved in revenue collection, revenue auditing and the approval of revenue allocated to counties. Since the outset of devolution, the approval of audited reports has been delayed, basing the allocation of funds for a specific financial year on the accounts from a number of years prior. This leads to the counties receiving less than the proportion that they would have received if the audits had been conducted in a timely fashion. For instance, the forty-seven counties received KSh 314 billion in 2018-19 based on the 2013-14 audited accounts. The 2013-14 revenue collection amounts to KSh 935.7 billion, while the actual revenue collection estimate in 2015-16 is of KSh 1.141 trillion.58 This implies that the cash disbursed to the subnational units in 2018-19 is 33.5% of 2013-14 budget, but it only represents 27.5% of the 2015-16 budget. Therefore, the counties have been deprived of more than Sh68 billion that could have been used to meet the immediate needs of their constituencies and further their development.

On this matter, the Council of Governors (COG) called upon the Senate to help the counties more swiftly receive the cash they need (and are entitled to) in order to discharge their functions. As a response, the Senate Finance and Budget Committee conducted public hearings on the counties’ Division of Revenue Bill 2018-19 in April 2017. The three agencies in charge were convened and a series of reciprocal accusations took place. The National Treasury justified its move to use the 2013-14 audited accounts to calculate the counties’ budget on grounds that it is the only financial year that MPs have finished probing in the last six years, even though the 2014-15 and 2015-16 audit reports were ready for scrutiny and approval.59 The Treasury Cabinet Secretary, however, did not consider this an issue as the amount received by the counties is always beyond the 15% minimum required by the law, independent of the audited accounts used for allocation.

This example lays out the contention over revenue allocation as a political economy matter subject to negotiations and agreements by a wide array of stakeholders at the national and local level. The unpredictability of the outcomes of the political processes behind it, and the national actors’ decision-making power over the Appropriation Bill, leaves the counties at the mercy of the center. This has negative impacts on their growth and on the strengthening of their capabilities as semi-independent units capable of assuming their constitutionally mandated duties.

58 See media reports such as https://www.the-star.co.ke/news/2018/04/02/delayed-audit-reports-to-blame-for-cash-crunch_c1739408 59 Ibid

48

D.2. Issue 2: Delayed Disbursement of Funds to Counties There is a delay in the disbursement of funds to counties, above and beyond the issue of underfunding explained above. As a Baringo revenue allocation office noted, “If you look at this currently, the delay of disbursements from national government is so high.” The counties enact their County Integrated Development Plans CIDPs and submit annual plans for projects to be implemented, only to realize that efforts are blocked as their share of national resources has to roll over to the following financial year. A Baringo county officer also noted that, “that is where you will see many counties having rollover budgets because the money never came on time for the procurement process to take place and implement that project.”

D.3. Stakeholder Tension over Revenue Distribution The counties often perceive those funding shortfalls and delays as deliberate efforts on the part of the national government to weaken them, since they can be accused of corruption by their constituencies for not delivering on their CIDPs, and development plans in general. This, in turn, legitimizes the national government in its bid to retain the largest portion of national revenue. Numerous voices from the counties have expressed concern over these issues as expressed by a Baringo revenue allocation officer’s sentiment, “I don't know if the national government is so serious and wants this thing to run, but we still hope they will accept in the long run.” Meanwhile, the concerned parties in Nairobi put the blame on each other or indicate deficiencies in the use of funds by counties as a reason for the delays in revenue disbursement. The deficiencies cited by them were either corruption at the county level or lack of proper legislation by the county assemblies to channel those funds. The corruption issue has been brought up also by CSOs from the counties such as Elgeyo Marakwet: “there is also this other challenge that came with devolution, the devolution of corruption.”

Moreover, the problems with funding disbursement were attributed to the counties by some national actors, including the Commission on Revenue Allocation (CRA), which blamed delays in disbursement of funds on the slow tax collection process from all counties of the country. The CRA, as a supposedly independent body mandated to recommend the basis for equitable revenue sharing between the national and the county governments, expressed its satisfaction with the revenue division between the national government and the counties. The chair of the CRA is nominated by the President in consultation with the Prime Minister and approved by Parliament. Two of the other seven members are nominated by political parties in the National Assembly and the remaining five by political parties in the Senate. The only nonpolitical member is the principal secretary for Finance. Although these nominees should not be sitting members of the National Assembly or the Senate, the composition will most likely introduce politics into revenue allocations.60

The CEO of the Commission on Revenue Allocation mentioned during our interview with him that the money allocated for each devolved function matches the amount that was allocated to that specific function at the national level. He also mentioned that the 15% minimum set by the 60 Njeru, K. (2010). Public Finance under Kenya’s New Constitution. Society of International Development. Constitution Series Paper Series No. 5. p. 23

49

Constitution is not a major concern, since the counties always receive more. From his perspective, the gradual revenue sharing process is convenient for this stage of devolution implementation in order to ensure that money devolved is put to good use and based on well-crafted plans and organized priorities.

D.4. Revenue Sharing among Counties Just as vertical revenue sharing between the national and county governments has its own issues viewed differently by stakeholders, horizontal revenue sharing among counties has generated its own share of debate. The institutional process is as follows: the Senate is required to review the basis of revenue allocation every five years according to the provisions and criteria set out in Article 203. In so doing, it will receive recommendations from the CRA, consult with county governors and the Secretary for Finance, and invite professional bodies to make submissions. Once the Senate arrives at a resolution, it will be required to submit the statement to the National Assembly within ten days, where it may be approved, amended or rejected by a two-thirds majority vote. Should the National Assembly not approve the Senate Resolution within 60 days, the resolution will be deemed approved. The Senate, on the other hand, may amend its resolutions at any time.61 The CRA has come up with a sharing formula62 that is based on six parameters weighed differently. Table D.1 outlines the distribution for fiscal years 2016/17, 2017/18, 2018/19.

Table D.1: Revenue sharing formula.

Parameter Weight Parameter Weight

Population 45% Land area 8%

Equal Share 26% Fiscal Effort 2%

Poverty level 18% Development Factor 1%

This formula has been in effect since 2016 and is subject to modification every five years. Contrary to the complaints of the rural counties, the CRA’s CEO sees that they get more than enough with this revenue sharing mechanism, along with the 0.5% equalization fund destined for marginalized areas and the conditional or unconditional grants that Parliament passes to poor counties. The CEO of the Commission expressed concerns over urban areas and cities not getting enough funds to run their affairs. CSOs from Kisumu and Mombasa counties echoed this concern, noting that their counties are struggling because the formula puts them at disadvantage. This is despite the fact that population size has the biggest weight, which is supposed to confer more revenue on urban counties. From their perspective, the difference in expenditure between rural and urban counties is greater than what the formula accounts for due to the difference in standard of living and taxes which are higher in the latter. In addition, the urban centers collect more taxes than the rural and thus believe they should receive more in return.

61 Ibid. p. 23 62 Commission on Revenue Allocation (CRA), Kenya website. Accessed: July 2018. https://www.crakenya.org/

50

In contrast, several voices from the rural counties have expressed disagreement with the formula, which they claim favors already developed urban counties, which have the means to raise their own revenue. Their argument is that equitable development requires an initial strong push for underdeveloped rural counties and poor counties that are unable to raise their own revenue so as to reach a certain level of basic services. The equalization fund and other measures of revenue transfer are still not enough to realize equitable distribution.

These discrepancies in opinion between rural and urban county stakeholders concerning their share of national funds add to the complexity of the CRA’s mission of equitable distribution of funds to the counties. Each party is defending its own interests and asks for more money to finance its expenses. Thus, the revision of the formula every three years is a tool that has been set by the CRA to ensure that the formula is updated to respond to feedback and work to further remedy the problem of unequal development across Kenya.

D.5. Concerns with Internally-Generated Revenue Sources The counties are also supposed to generate their own revenue through taxation. In the counties that have resources and services to tax, several county officials and CSOs mentioned that this process is improving, as people are more accepting of getting taxed in exchange for the development that is taking place in their counties. Baringo, for instance, moved up from KSh 249 million revenue collection in the fiscal year 2014/2015 to KSh 286 million during the fiscal year 2016/2017.

The challenges to the improvement of county revenue collection lie in several factors. One is the lack of proper or sufficient legislation for levying specific taxes, according to several stakeholders. The CEO of the Kenya Law Reform Commission (KLRC) mentioned that “numerous counties use the Finance Acts as the basis for levying fees, charges and taxes, which is wrong, because Finance Acts are destined for the amendment, increase, decrease or consolidation of the various charges levied legally and endorsed by specific laws.”63 He gave an example from the health sector, stating that “a number of county governments do not have [a] health facilities law, which can then be the basis for saying that if you go to this level of health facility we will charge you so much per night.”64

A Baringo revenue allocation official stated that counties do not generate revenue to their full potential because of the lack of adequate legislation. The issue of lack of legislation at the county level of government has been a subject of agreement by the majority of interviewees. Several reasons have been offered to explain this issue, including the illiteracy of county assembly members (CAMs), their lack of training in legislation drafting, and the weak to non-existent support from the national government to the county assemblies in terms of capacity building in this domain. On that note, the KLRC’s CEO justified the limited support from the national government to the counties by noting the few numbers of drafters in the country as a whole, due to the high expenses of training.

63 CEO, Kenya Law Reform Commission 64 Ibid

51

A second challenge to county revenue generation is the lack of national laws on revenue sharing between the two levels of government from resources situated in a specific county. An example from Baringo in the forest sector is that while environmental management has been devolved to the counties, the revenue from Baringo’s forests all goes back to the national government, just as it did before devolution. The Kenya Forest Service remained a national government function and the counties were given responsibility over the environment, yet the law governing this sector did not change to reflect this reality. Such lack of legislation on sharing ratios deprives counties of important revenues from their own local resources.

D.6. SWOT Analysis Based on the interviews conducted in this research, the following strengths, weaknesses, opportunities and threats (SWOT) were identified in the area of Revenue Allocation and Inter-Governmental Relations.

Strengths Weaknesses

● Poor counties receive a share of national revenue and are able to implement development projects

● Increased public awareness and involvement in public finance checks and balances

● financial resources ● Devolved corruption culture: “it’s our time to eat” ● Heavy wage bill due to the increase of public

servants, leading to excessive recurrent expenditures

Opportunities Threats

● Promoting sustainable peace ● Enhancing social cohesion

● New kinds of exclusion and marginalization based on county belonging

52

Appendix E: Inclusion, Public Participation and Role of Civil Society E.1. Public Participation: Balancing Constitutional and Lived Realities The provisions for public participation at the county government level are much more comprehensive. In fact, discussions with various civil society representatives hardly touched on the ways public participation is facilitated at the national level. Indeed, this may be unsurprising, considering that most of these CSOs are community-based organizations that work closely with local communities. At the same time, these CSOs engage directly with county governments on specific issues relating to devolution such as health, environment and education, as public participation cuts across many of the provisions under the devolved system. This can also indicate a gap in the existing mechanisms at the national level. For county governments, the PFM Act further establishes structures such as the County Budget and Economic Forum as a platform for consultative planning and budgeting processes whereby the public can be directly engaged.65 It also encourages the respective counties to pass their own bills that will provide guidelines, structures and mechanisms on citizen participation in relation to public finance and management.66

The County Government Act expanded the provisions for public participation, outlining both principles and processes at the county level.67 It lays out various mechanisms that can facilitate citizens’ meaningful engagement in county decision-making processes. This includes organizing town hall meetings, putting up announcement boards, conducting site visits, among others (Section 91). Additionally, the Act mandates timely disclosure and dissemination of “information relevant or related to policy formulation and implementation (Section 87)” by county governments. This information includes planning and budgetary documents. More importantly, there is a whole chapter dedicated to citizen participation that clearly spells out the rights and the important role that citizens’ play in ensuring that county governments remain relevant and responsive to the people’s needs. This includes the right to contest and challenge county decisions and be responded to accordingly.68 Truly, this Act captures the spirit of the Constitution in what it hopes the devolved structure will contribute in the transformation of Kenyan society.

Other laws that enshrined public participation are the Urban Areas and Cities Act (2012) and the Intergovernmental Relations Act (2012). The former provides for the involvement of the public in the management and governance of their respective cities, while the latter underlines transparency and accountability to the people from elected county officials in national-county cooperation and engagement. Indeed, the passing of these laws shows the commitment of the Kenyan government to realize the full potential of the 2010 Constitution, particularly in making sure that Kenyan citizens have the necessary structures and opportunities to participate and 65 Section 137 (3) and Section 175 (1 &5) of the Public Finance Management Act of 2012. 66 Section 207 of the Public Finance Management Act of 2012. 67 The Status of Public Participation in National and County Governments. Intergovernmental Relations Technical Committee. Nairobi, Kenya, p 22-23; and The County Government Act 2012. 68 See Chapter VIII of The County Government Act 2012 for the full provisions on Citizen Participation.

53

influence policy and meaningfully engage in socio-economic decision-making processes. However, it is also telling that the Public Participation Bill69 is gathering dust in the Senate and has not been passed. The stalling and non-passage of this Bill may indicate the apprehension as well as opposition of those in government to what may be perceived as providing legitimacy and greater power to the people to contest the state’s power. Indeed, the Bill will be able to provide a clearer legal basis from which county and national governments (non)compliance on public participation can be challenged.

On the other hand, some question the value of adding additional legislation, given that there is already an existing array of laws with specific and explicit provisions on public participation, making the Bill redundant.70 While this may be a credible point, one of the many challenges identified by participants in this research has been the absence of a unifying framework that would outline criteria and guidelines on public participation. The Constitution mainly gave counties the discretion to stipulate their own specific guidelines for public participation, but not many took the initiative to do so. Thus, there is much confusion and disagreement on how this process should be implemented. For example, one CSO group queried whether, in a county with a population of one or two million, public participation with only 50 people should constitute a quorum. Similarly, they wondered whether, in a ward composed of several villages, it still qualifies as “public participation” if those present only come from one locality/village. In a focus group discussion in Baringo, one CSO representative commented that since there’s no policy, “even two people can meet and agree on behalf of the whole village or the whole population.”

People are hopeful that the Bill, if passed, will be able to reconcile these inconsistencies as well as guarantee the quality of public participation being implemented. Yet various civil society organizations lamented that despite prevailing structures, citizen engagement remains weak and perfunctory. Even some county government officials admitted that public participation is not carried out in line with the various laws outlined previously. For several counties, these lapses were attributed to a lack of resources. One county official offered that “the equitable share that comes from the national government to the counties is still minimal. If we look at it keenly, you'll discover that much of it goes to recurrent (expenditures). So, in one way or the other, we are forced to engage with partners so that they can fund some other activities and some other projects for us.”

As discussed in the earlier part of this study, most, if not all, counties faced significant challenges in both their resource allocation and resource generation. Indeed, as public participation requires additional structures in the government, human and financial resources are needed to keep it going. For example, the County Government Act allows counties to further decentralize their functions and services below the village level with the approval of the County Assembly.71 But only a few counties were able to establish village-level structures. The majority of county governments only managed to decentralize down to the ward level. Doing the former entails

69 This Bill had been gazetted in the Senate on March 5, 2018. See draft here: http://kenyalaw.org/kl/fileadmin/pdfdownloads/bills/2018/PublicParticipationBill_2018.pdf 70 See: https://www.the-star.co.ke/news/2017/05/13/engaging-in-a-public-participation-law_c1558946 71 Article 176 (2) of the 2010 Constitution. Also see: http://www.fes-kenya.org/media/publications/Devolution%20Booklet%20for%20web.pdf

54

hiring village level administrators and other relevant personnel, as well as organizing public participation forums in remote areas where accessibility and security are likely concerns. Although public participation at the ward-level has encountered similar challenges, the burden is transferred to citizens. People now have to travel to attend public participation forums, yet only a handful of them have the resources to do so.

Undeniably, issues of poverty and illiteracy have significant impact on the quality of public participation. The onset of devolution has brought development to counties that have never received nor seen any form of public services before. Communities, together with their county officials, are now able to discuss and deliberate over development and budget plans for their village or ward. They are also consulted on projects that are to be implemented county-wide. Through this process, roads have been built, health facilities constructed, Early-Childhood Development Centers (ECDC) established, and agricultural machineries purchased. People often dubbed these as the ‘fruits of devolution,’ that is, signs of development that they are experiencing for the first time. Still, poverty has remained high. Reconciling regional inequalities, usually observed along ethnic lines and exacerbated by policies of past administrations, is one of devolution’s greatest challenges. Both CSOs and county officials recognized that it will take significant resources and time to bring poor counties on par with counties that are economically better off. In most cases, poverty-stricken counties also have high illiteracy rates. This is particularly true for northeastern counties like Turkana, Wajir, Garissa and Mandera, where poverty and illiteracy rates affect almost 90% of the population.72

A CSO member from Kisumu explained that economic development and civic education have to go hand in hand, “if you sleep hungry or your children sleep hungry, do you go for citizen participation or you go for work and your children get something to eat?” There is, however, an intense debate among civil society actors regarding the issue of monetary support for people to participate. For some, this may serve to encourage a dole-out mentality, while others stated that it is only fair to provide people with meals and transportation allowance. Still others were supportive of only providing non-monetary incentive, such as lunch and refreshments.

CSOs also emphatically argued that county governments aggravate the problem with the ways they handle and implement public participation. While some of them conceded that the counties are trying their best, counties need to improve the accessibility and legibility of public documents provided to the people. Moreover, communication on schedules, venues, and agenda for the forums were often circulated late and sometimes these never reached NGOs with strained relationships with the government. Additionally, continuous postponement of public forums or holding these at inappropriate times were minor but recurrent problems that CSOs told us affect community member engagement. In a focus group discussion in Kisumu, CSOs explained that if a community member has to travel far to attend a public forum and then has to wait five hours

72 Illiteracy rate for Turkana is at 82%, with a poverty incidence of 87.5% of the population. Please see additional reports on illiteracy and poverty rates in Kenya here: Poverty Report by Society for International Development: http://inequalities.sidint.net/kenya/national/poverty/2/; kenyans.co.ke news report: https://www.kenyans.co.ke/news/20426-kenya-national-bureau-statistics-study-reveals-counties-lowest-poverty-rate-452-kenyan; Reports on Illiteracy in Kenya: https://www.standardmedia.co.ke/article/2000098680/turkana-and-wajir-counties-have-highest-levels-of-illiteracy; and http://www.eldis.org/document/A31868

55

or more for it start, only to get confused with the language being used by the facilitator and not even getting tea or reimbursement for transportation, would this community member continue to participate? The assertion from county officials that their human resources do not have the capacity to facilitate public forums makes matters worse. As long as revenue allocation remains low, not only public service delivery but even public participation will be affected.

However, underlying the issue of incentivizing public participation is the bigger challenge of elite capture and corruption, which CSOs repeatedly pointed out. Many respondents characterized this as the ‘lack of political goodwill from the respective county governor.’ In Kisumu, one group reported an instance in which county officials paid 10 individuals KSh 1,000 each to participate in a public forum, in order to get the ‘public’s approval on a particular government document. Several people also observed that these forums can be easily captured by Members of the County Assembly (MCA), which then makes it difficult and even risky to oppose measures or voice dissent. These MCAs are then able to drive the public participation to align with their own agenda.

Clannism and the mentality of ‘it’s our time to eat’ still persist even in the new devolved structure. One CSO member captured this in an analogy of the monkey and the forest: “even though the forest will change the monkey will remain the same, these were politicians that were once upstairs and now they are all downstairs.” The issue of corruption is particularly ripe in the procurement process. CSOs who are doing public expenditure tracking noted inconsistencies in materials purchased by county governments. They also pointed out that, at times, contracts don’t undergo any vetting process and are awarded either to family members of county officials or their cronies, who often inflate the price for development projects far beyond their worth. The bureaucracy inherent in the process and the fact that public participation is limited once implementation starts (that is, during the procurement process) have provided loopholes that have been taken advantage of by politicians and county officials.

E.2. Inclusion and Social Integration The constitutional mandate to expand the participation of women, youth, minorities and marginalized groups informs how public participation forums have been organized and alternative platforms established. For example, in counties like Elgeyo Marakwet and Baringo, the government has deployed mobile applications like WhatsApp or text messaging to inform and engage the youth. They have also set up websites where relevant data can be accessed, as well as established a hotline for complaints and compliments so people can provide feedback to the county. The representation of women and inclusion of minorities in the County Assembly has slowly given women confidence to participate in meetings, particularly in the rural areas where negative perceptions of women contributing to discussions are still a challenge. A few NGOs are involved in helping women organize and run for election, so that more women are elected in power rather than nominated.

Indeed, the inclusion of gender in the Constitution has spurred a timely debate on women’s representation and gender equality in the country. This has also opened-up spaces for conversations on the overall plight of women within Kenyan society. The issues of minority rights and marginalization were also given considerable attention by the new Constitution. Seats are

56

reserved in both the County and National Assemblies for representatives from various sectors: youth, women, persons with disabilities and other identified minority and marginalized groups.73 One county official from Baringo recounted that this inclusion has dispelled negative myths about people with disabilities and has enabled them to access and participate in socio-political processes. However, those interviewed were divided about how well devolution has contributed to inclusion and ethnic integration, and these clearly remain contentious points under Kenya’s devolved structure.

In the majority of conversations, CSOs underscored the point that not all MCAs were elected by the people; some were nominated by the Governor or the ruling party. They specifically referred to the reserved seats for women and minority and marginalized groups. This adds to the complexity of holding public participation forums in the counties. For example, in Mombasa, more than half of the women Members in the County Assembly were nominated. In several counties, the seats reserved for the representative of the People with Disabilities (PwDs) have been given to another minority group. Local civil society actors agree that such haphazard nominations undermine the oversight role of the County Assembly and their effectiveness in representing their constituents.

CSOs also highlighted the fact that ethnicity still drives job employment and job postings within county governments. A community member from Kisumu shared “I was born and raised knowing that I am Luo by tribe until devolution came. Then I had to realize that I'm not just Luo, I'm a Luo from Gem. Some people argue that devolution has managed tribalism by keeping communities in their spaces, in their cocoons.” Representatives of local organizations in Mombasa also shared the same sentiment. They explained that people who migrated from other parts of the country are now having trouble finding jobs in Mombasa, since their surname or ethnicity is not from this area. People are being told to go back to the counties where they came from. CSOs and even some county officials were concerned that devolution may actually be creating new minority groups or at least perpetuating another form of marginalization. Despite the fact that the County Government Act has provisions against the monopoly of appointments by a dominant group,74 those who are in positions of power are most often appointing individuals that will benefit them and their groups. Although some argue that politicians and county officials need to be further educated about the various laws governing devolution, some also insist that these people know the laws but are blatantly ignoring them. One CSO member claimed that “there are some politicians who don't adhere to policy, they tend to believe that everybody should just go back to their counties to give their services, while the county should just employ their own people.”

A county official from Baringo commented that devolution has, in some ways, reduced ethnic rivalries within the county as resources have trickled down to various wards and villages. It has also encouraged ethnic integration, as it focuses people’s attention away from national politics and to their respective counties. The latter is worth bearing in mind since the establishment of the 47 counties took ethnicity into consideration as a matter of political compromise.75 Thus, the 73 Articles 97 (c) and 177 of the 2010 Kenya Constitution; Article 7 of the County Government Act (2012). 74 Article 65 of the County Government Act 2012 states that “at least thirty percent of the vacant posts at entry level are filled by candidates who are not from the dominant ethnic community in the county.” 75 As per conversation with IEA staff

57

majority of the 47 counties are comprised of populations belonging to one particular group (as in the case of Baringo), which makes ethnicity much easier to manage.76 In such instances, following the provision on appointments (70% to dominant group and 30% to other groups) becomes a problem, as there are hardly any other groups in the county that can fill the 30% slots.

Additionally, the economic regional blocks that have formed, as in the case of the counties in the Rift Valley and in counties on the Coast, suggests that devolution has been able to foster inter-county collaboration and thus ethnic cohesion. A few respondents pointed out, however, that these economic blocks are composed of tribes that are similar in culture and political leanings.

More importantly, the coming of devolution has compounded existing resource-based conflicts and boundary issues. County officials highlighted the problem of grazing rights for pastoralist communities, which generally do not adhere to county boundaries when herding their livestock. The pressure to generate revenues to finance county government functions has also pushed counties to partner with private corporations for joint mineral explorations and development.77 While this is reasonable, the problem starts when these kinds of initiatives come in conflict with the local community’s interests, and when it affects pasture areas. Although there is an existing structure for alternative dispute resolution, as well as traditional peace committee’s set-up during previous administrations that can intervene when conflicts arise, it is unclear under which jurisdiction these structures now belong within the new devolved government. Thus, the majority of peace committees have stopped working, partly because they have been unable to secure funding.

E.3. Civil Society and the Shrinking Democratic Space The role of CSOs in civic education has been recognized not only by CSOs themselves, but even by county officials. In fact, the advent of devolution seems to have created what social movements scholars call a ‘political opportunity structure’ that facilitates collective action among activists and other civil society actors.78 This is manifested in the formation of local coalitions and networks of civil society organizations within specific counties. The work of these organizations mostly focuses on civic education and sensitization, social auditing and participatory budgeting and planning. Such activities augment and complement the functions devolved to counties, but also serve as mechanisms for monitoring and accountability. CSOs, therefore, play a dual role of facilitating, serving as links between the community and the government, and as watchdogs of devolution. In Elgeyo, for example, representatives of the

76 It is worth noting that the delineation of the 47 counties as devolved units were not determined based on agreed mechanisms nor was it informed by the aims of devolution but mainly reflected the 47 colonial-era districts (Kivuva 2010, p 19) See also: Akoth, Steve Ouma. (2010). Challenges of Nationhood: Identities, Citizenships and Belonging under Kenya’s New Constitution. Society for International Development. Constitution Working Paper Series No. 10. 77 Counties get 20% of the share from royalties, while local communities get 5% and the national government get the lion share of 75%. 78 Political opportunity structure is the features of a regime that facilitate or inhibit a political actor’s collective action. For the complete definition, see: Tilly, Charles and Tarrow, Sidney. (2015). Contentious Politics (2nd ed.). Oxford University Press. p. 258.

58

coalition of CSOs were involved in a technical working group that drafted the county’s public participation guidelines.

However, in other counties, the relationship between civil society actors and county officials is strained and antagonistic. This is particularly the case for those who vocally criticize the shortcomings and wrongdoings of the county governments. One county official we interviewed acknowledged that there is a prevailing perception among those in government that civil society actors mostly cause trouble, “Although they can help, they generally complain and criticize without proposing solutions.” This contrasts notably with the perspectives of the CSOs in these counties. In response, several local grassroots organizations have strengthened their partnership with community members, enabling the latter to use their own voices to hold their respective counties to account. CSOs recognized that their greatest power lies in numbers and in the people standing together with them.

While the relationship between civil society and the government has always been ambiguous, punctuated with moments of cooperation, competition, and enmity, this relationship has also kept the excesses of tyranny in check. The same can be said of CSOs in Kenya that have historically opposed and struggled with repressive regimes.79 Certain progress was made during the administration of Kibaki, which helped give birth to the Public Benefits Organizations (PBO) Act. This Act provides clear guidelines and criteria for NGOs and other public benefits organizations to maintain high standards and management through effective self-regulation.80 The Act also safeguards these organizations from arbitrary deregulation from the state. Despite having been passed in 2013, the Act remained non-operational and is currently one of the sources of tension between Kenyan civil society and the state.81

In fact, representatives from civil society and advocates of the Act claimed that the repression against civil society organizations increased in 2013 and continued to expand up to the present, mainly through “punitive and prohibitive governance frameworks.”82 This is particularly evident against human rights groups, the media, and non-government organizations whose work focuses on corruption and accountability. They have also been subject to smear campaigns that have labeled these types of organizations as “evil” and conniving with foreign institutions to cause domestic trouble. The involvement of both the current president and vice-president in a case filed at the International Criminal Court for crimes against humanity during the post-election violence of 2007-200883 further aggravates the relationship between these two sectors. Some critics argued that the current rounds of deregistration -- which has included the Kenya Human

79 Kabeberi, Njeri. 23 December 2016. The Role of the State in Shrinking Political Spaces for CSOs in Kenya. This is Africa. Accessed at: https://thisisafrica.me/role-state-shrinking-political-spaces-csos-kenya/

80 ibid.

81 See: https://www.the-star.co.ke/news/2018/03/10/gazette-pbo-act-for-accountability-ngos-tell-state_c1727511 82 Kenya Human Rights Commission. (October 2016). Towards a Protected and Expanded Civic Space in Kenya and Beyond: A Status Report and Strategy Paper Developed for the Civil Society Sector in Kenya. Nairobi, Kenya. p 15 83 See: https://www.nation.co.ke/news/ICC-Uhuru-Kenyatta-William-Ruto/1056-4345670-71sa15z/index.html

59

Rights Commission in the list of organizations to be deregistered -- is politically motivated and is meant to silence and delegitimize the country’s civil society.84

While it is not the aim of this report to provide an exhaustive assessment of the status of civil society engagement with the government, it is worth highlighting that active civic participation in the country’s political sphere is not as straightforward as laid out within the framework of public participation under devolution. In the interest of expanding the public’s participation, civil society organizations have to navigate complex political relations and find creative means of engaging the government while resisting government actions that inhibit their movement and even threaten their existence.

E.4. SWOT Analysis Based on the interviews conducted in this research, the following strengths, weaknesses, opportunities and threats (SWOT) were identified in the area of Inclusion, Public Participation and Role of Civil Society.

Strengths Weaknesses

● Dissemination of information on the schedules, agenda, and documents to be interrogated during the public participation forums

● Proximity of government enables accessibility and increases accountability

● Partnership between county government and CSOs to organize civic education forums

● Laws such the Public Finance Management Act and Public Participation Act provide guidance to county government as well as protect the rights of citizens to be actively involved in decision-making processes

● Establishment of Complaints and Compliments Committee (in some counties) as feedback mechanism

● In some counties, public participation reaches the village level

● Formation of regional economic cooperation blocks (Northern Rift Region, Southern Rift Region and Coastal Region)

● Civil society involvement in civic education, awareness and sensitization programs

● Civil society act as link/bridge between the people and the county government

● Reduced ethnic tensions within some counties through equitable resource distribution

● Representation of women, minority groups and marginalized groups in County Assembly

● County government lacks resources to support public participation forums as well as capable staff to facilitate them

● Most County Governors retain the power to influence who gets represented/nominated in the County Assembly

● In some counties, public participation forums are held only at the Ward level

● Complaints and Compliments Committee not yet activated/operational

● County members don’t have access to relevant data nor the capacity to understand what would enable meaningful engagement in public participation

● Information in relation to public forums is disseminated late or drafted in very technical language

● Most counties don’t have legislation on public participation that can provide guidelines on this process

● Communities are only involved in the planning and budgeting but not during implementation and procurement process

● Youth are left out of most public forums which usually cater to the ‘wazees’ (older people)

● Devolution fails to encourage inter-county cooperation

● Difficulty finding work if one is not from the same

84 See: https://reliefweb.int/report/kenya/ngos-kenya-protest-threatened-deregistration-959-organisations; https://www.nation.co.ke/news/NGOs--We-were-shut-over-plan-to-contest-poll-result-in-court-/1056-4059114-jc5pvc/index.html

60

● Community members’ growing awareness of their role to participate in political decision-making processes

● Some counties have passed legislation that can provide guidelines on public participation

county; Laws on employment are not followed ● Devolution of patronage and clientelism:

Governors or MCAs hiring people from their side of the tribe

● Few women in leadership positions. ● CSOs work mostly in well-off areas of the county ● Procurement Law of the country does not provide

for public participation and is an avenue where corruption happens, and projects get delayed or not implemented

● Some community members need incentives to participate in the form of travel allowance, food, etc.

● In some counties (CSO perspective), public participation is only done in the Ward for the budget allocated for the Ward but not for county-wide, mega-projects

Opportunities Threats

● Public participation can be improved if data are collected at the village level and shared with people who need it

● Accessibility and capacity to understand relevant information will enable meaningful engagement

● Some counties have partnered with CSOs to gather data and set-up databases

● Counties with legislation on public participation plan to introduce amendments based on feedback and in consultation with CSOs and members of the community

● Some counties are deliberating on strategies to initiate inter-county cooperation

● Political will from the leaders needed to fully enforce and implement devolution

● Devolution provided a structure for civil society to coalesce and cooperate on issues specific to devolution and its impact on citizens

● The way devolution is structured (county-centered) may not promote integration and national unity as it does not allow for collaboration and cooperation across counties

● Creation of new minorities within counties ● Public participation captured by gatekeepers and

politicians for their own agenda ● Shrinking space for civil society: in some counties,

local activists are verbally and physically threatened and abused

●

61

Appendix F. Expectations for Devolution and Possible Future Scenarios F.1. Reasons for Optimism or Pessimism about the Future of Devolution Stakeholders interviewed expect that devolution will continue to yield positive dividends as long as it transforms and adapts to the needs of the people and the demands of development. For Kenyans, their political journey has been a progressive one, involving the gradual discovery of what is best for them, from the experience of one-party rule, to multi-party rule, to the current devolution exercise. That journey has and will continue to involve identifying what works and what does not work -- and making what works work better -- in order to create the form of devolution that is fitting for Kenya.

The resources allocated have been used to provide tarmac roads for the first time and build more ECDCs. For historically marginalized counties, these projects create a feeling of being part of the country. For some counties not having prior experience with such development, these infrastructural developments and improvements in social services make devolution’s impact noteworthy and significant. At the moment, social needs such as education, health, transport, and agriculture are being prioritized. County officials hope that this will be followed by industrialization and further infrastructural investments. A substantial investment of resources, coupled with realistic planning and non-duplicative projects, will be required to attain this level of progress.

County officials also mentioned the importance of mega-projects across counties in enhancing the realization of their optimistic vision for devolution. They recognized that mega projects might face challenges in deciding on locations to site them. This can become contentious, because the county in which the project is located could be associated with all the credit for the project, while other contributing county governments need to justify to their people why the mega project (infrastructure) was not located in their county, and risk losing their share of credit for the project.

County officials expect that credible and up-to-date research and data will inform planning and allocation of revenue to counties. With these improvements in efficiency in the management of revenues, there will be less waste. Efficiency in the use of resources will lead to growth in revenue, and subsequent increase in investments. Optimism is contingent on revenue growth, improvements in service delivery, and more investments. County officials expect that this will translate into more income and increased standards of living. To facilitate this process, stakeholders identified the importance of counties’ autonomy. Counties with internally generated revenue can dispense their own funds to execute planned projects without the delays that accompany the release of allocated funds by the national government. While this may not happen within the 20-year timeline, many believe that a time will come when counties will be fiscally self-sufficient if devolution is practiced prudently - that is, with care and thought for the future.

62

Future competition between counties was mentioned by some CSOs and county officials as a basis for their positive outlook on devolution. As counties that have made substantial progress can serve as examples/standards for other counties, they become points of reference for citizens as they demand the same level of service or transparency from their own counties. Respondents believe that substantial progress will occur in those counties in which there is genuine commitment to citizen engagement/public participation, where resources are used for priority and high impact projects, where county governments are open and transparent in the use of funds, and projects are implemented without inflation of budgets or misappropriation. Stakeholders expect that this positive competition between counties will yield well-established and infrastructurally advanced counties that are able to specialize in what they do best, engage in inter-county trade, and boost the prosperity of Kenya. Sustained growth will also decrease the possibility of electing leaders along tribal lines. Leaders will be elected based on their ideological standpoints, visionary leadership and ability to deliver on promises.

The current system of governance was described by some county officials as too big and expensive, with many people at the national and county levels occupying elected and nominated positions and being paid to do practically nothing. These officials believe that these numbers ought to be brought down so as to reduce the wage bill (the cost of wages) from the political class. They argue that the funds salvaged from these savings should be channeled into grassroots development work and the employment of more doctors, nurses and teachers, in order to achieve the optimistic vision of devolution in 10-20 years.

The importance of good laws and law enforcement was identified by CSOs as an enabler for the realization of an optimistic future for devolution. Laws that have yet to be amended to reflect the devolved structure should be reviewed and updated. Laws on how complaints should be addressed, on procurements, audits and use of public resources, and on corruption, were identified as areas of legislation that need to be reformed and implemented.

Concerns about political will also need to be addressed in order to build an optimistic future for devolution. Political will was identified as the root of other problems; respondents argued that if political will is addressed, this will help to address concerns about resource allocation, the transfer of functions to counties, and the provision of adequate resources to perform those functions. According to CSOs, political will is essential in order to transform promises into policies and to implement the pro-devolution provisions of the constitution, including provisions for “transparency, accountability, public participation, intergovernmental relations, functional assignment” (CSO Representative, Nairobi). At the moment, civil society leaders perceive that devolution is threatened by politicians who want resources and positions. Good leadership at all levels is needed in order to implement the principles and practices of devolution and attain the kind of governance system that Kenya desires.

CSOs recommended that there should be fewer (or no) political appointees/nominations, but rather predominantly elected positions. In this way, it will be clear that loyalty belongs to the people and not to the political party. CSOs also expressed concerns that Senators and Members of County and National Assemblies have become derailed in the performance of their tasks, especially the task of serving as the watchdog (i.e., providing checks and balances) on the executive. “I don’t know. When they sit in their debates, do they bring motions which are going

63

to help the citizens? Or are they just bringing motions to help themselves? That is the biggest problem we are having. When I hear people saying they want to be given cars, they want to be given allowances, some want to fly to America and back to go do a benchmarking… [but] they will never tell us when they went and what they did see. What is going to help the common citizen here on the ground?” (Civil Society Representative, Machakos).

CSOs highlighted the role of poverty in clouding citizens’ objectivity and ability to choose the right leaders. Electoral periods were defined as “dry periods” in which people are easily manipulated by “food and a little stipend” to sell their votes. Kisumu CSOs also fear rising inequality, as the expanding political class continues to amass public resources for private gain “...Going by the current situation, I am not optimistic at all. I see a situation the same as what JM Kariuki saw in the late 60’s or early 60’s where we have a community with 1 million beggars versus 100 billionaires, that is my take” (Kisumu CSO Collective Interview).

Political leaders need to interact freely, sharing information and working together with citizens in a bottom-up approach. CSOs fear their shrinking space in Kenya and recommended that government should engage with civil society actors for effective civic education. Information and access to civic education was defined as a driver of progress. With access to information, citizens cannot be cheated or manipulated endlessly. CSOs demand that they be seen by government as partners; government should support them and entrust them with the responsibility of civic education, sensitization and capacity building for citizens. “I foresee a future where there [are] active citizens engaging governments and the government engaging the people” (Mombasa CSO Collective Interview).

Respondents see the need for monitoring and auditing the development projects that each county proposes, in addition to community efforts in checking that outcomes are equivalent to allocations. An authority set up to audit the progress of devolution across the 47 counties, to ensure that projects are completed and also serve their intended purpose, would be valuable. “For us to [exist requires the] role of each and every citizen. It is not a matter of one person, it is a communal thing. We need to join hands in order to fight this war, for devolution to be devolution and democracy to be democracy” (Mombasa CSO Collective Interview). A summary of the reasons for optimism and pessimism toward devolution, as recounted in this section, are summarized in Table F.1.

CSOs recommended that there should be fewer (or no) political appointees/nominations, but rather predominantly elected positions. In this way, it will be clear that loyalty belongs to the people and not to the political party. CSOs also expressed concerns that Senators and Members of County and National Assemblies have become derailed in the performance of their tasks,

64

Table F.1: Reasons for Pessimism/Optimism

Reasons for Optimism

● Visible and substantial improvements ● More investments that increase the standard of living and quality of life ● More resources from donors and implementing projects that cut across counties for wider impact ● Competent Kenya-centered leadership

Reasons for Pessimism

● If responsibilities/functions assigned to the counties do not match allocated revenues ● If counties lack adequate access to resources or become completely dependent on the allocations from the national

government ● If the political class remains unresponsive and effective civic engagement is not prioritized

F.2. Possible Future Scenarios Government accountability and civic engagement will be required to enjoy the maximum gains from the revenue allocation and public participation mechanisms. Accountability requires commitment to the interests of the citizens on the part of county and national governments, independent commissions, and all state, intrastate and interstate agencies. Considering that there are various interests among citizens, depending on residence or identity groupings (e.g., rural versus urban; ethnic or religious affiliations; gender or age groups), accountability will require additional efforts to ensure that resources are distributed in a free and fair manner. This will involve more honing of the criteria and weights of the CRA, as well as a focus on dealing with corruption and leakage of public funds.

Although the role of civic engagement in enforcing accountability has often been heralded, the possibilities for civic engagement to inform change can be stunted by unresponsive governments. Civic engagement requires that information and access is provided to civic educators by the government, and that this information is translated into formats that every citizen can understand - that is, succinct and free of jargon. Other requirements for effective civic engagement would be the eradication of poverty and illiteracy levels, so that true civic engagement is not hijacked by the more educated or wealthy sectors of society. With all of these considerations in mind, Table F.2 offers possible scenarios for the future of devolution in Kenya.

65

Table F.2: Possible Scenarios for the Future of Devolution in Kenya

Public Participation

Low High

Reve

nue

Allo

catio

n

Hig

h

“The List System” “Inclusive Prosperity”

● Citizens are unable, through public participation, to decide on development priorities for their constituencies. This fuels a lack of ownership or other commitments needed for projects to succeed.

● The lack of interest in engaging citizens gives government excessive leeway to misappropriate resources and encourage patronage that may create new minorities and exacerbate existing inequalities within counties.

● Corruption among county governments and officials stunts development and public service delivery.

● Revenue allocation increases to counties based on credible research and driven by equity.

● High government accountability at all levels coupled with engaged and informed citizens result in people-driven planning and ownership of projects.

● Better public service delivery increases people's’ faith in the government and reinforces active engagement from the people through public participation.

Low

“Rifts and Grafts” “Frustrated citizens”

● Low accountability and civic engagement give leeway for those in power to misappropriate public resources.

● Lack of resources will limit effective public service delivery, feeding into the disillusionment and apathy of the people regarding public participation.

● Corruption is pervasive in the counties where available resources get funneled along ethnic lines fueling ethnic tensions.

● Agitation continues to fall on deaf ears; such agitations and requests for increased revenue can be likened to “pity parties.”

● Increased calls for greater autonomy or even secession of Counties from the National Government.

● Unrealized hopes make citizens frustrated, leading to proliferation of social movements. Citizens turn to more aggressive and violent forms of social movement to make their demands heard.

66

Appendix G: Recommendations G.1. Public Service Delivery and Development Outcomes Despite the aforementioned weaknesses, the interviewees were also optimistic about the potential of the devolution system to ensure improvement in services and development. The interviewees outlined opportunities for further improving service delivery and development. These included:

● the need to increase the revenue allocated to counties; ● the need to focus on fewer high-impact projects rather than multiple small-scale

projects; ● the need for affirmative action initiatives for bridging the development gap between

areas; ● greater involvement of county officials at all levels in project development; ● stronger intergovernmental relations and communication between the national and

county government levels; ● reviews of previous CIDPs, in a lessons-learned format, for the purposes of reducing the

likelihood of encountering similar problems in the implementation of new CIDPs; ● involvement of the media in monitoring county government officials; and ● the need to increase the technical capacity, capability and integrity of county

government staff.

The suggestions from the interviewees are relevant and reflect local perspectives on the necessary changes. There are also proposals for improving service delivery within a legal institutional framework. An effective and transparent public participation framework should be implemented to ensure that participation leads to greater representation, inclusion and localized development and services, even if the process is merely consultative. While the County Government Act includes a section on Citizen Participation, it is necessary for counties to receive specific and detailed guidelines on public participation. The Public Participation Bill, currently being discussed in parliament, will hopefully provide specific provisions on how to meet the aforementioned goals.

The County Public Service Board and the office of public service within the counties have an obligation to meet the values and principles of public service delivery stipulated in the Constitution, including equitable, impartial, efficient and effective public service delivery.85 The County Public Service Board has an obligation to investigate irregularities in public service delivery as well as cases of corruption within county public service.86 These offices need to carry out their mandate to ensure that public service delivery within counties is not negatively impacted through fraudulent behavior and the limited ethical values demonstrated by, possibly, a few public service officials.

85 Part VIII of the County Government Act, No. 17 of 2012. 86 Article 75 of the County Government Act, No. 17 of 2012.

67

The County Public Service Board, for instance, needs to implement structures that promote and enable greater accountability in order to enable greater public participation and representation within the work of county governments. This would also help to increase transparency which is necessary for ensuring greater accountability in the work of county government officials. The lack of cooperation between the national and county government has translated into delays in procurement that have led to subsequent project implementation suspension or deferment. The Constitution of Kenya also stipulates the need for cooperation between the national and county government through the establishment of joint Committees and Authorities.87 Greater cooperation is essential to prevent further delays due to bureaucratic constraints. This kind of cooperation is a constitutional obligation for both levels of government.

In summary, the residents of counties have multiple guarantees within the Constitution of Kenya and the County Government Act. In order to realize these guarantees, county governments need to comply with the provisions within the aforementioned legislative instruments. There is also the need to improve intergovernmental relations between the national and county governments, reduce bureaucratic constraints in procurement and ensure prompt and adequate transfer of resources from the national to the county government. These constraints have caused delays or deferments in project implementation and improvements in public service delivery within counties.

Finally, the transfer of resources and the responsibility for functions such as agriculture, primary healthcare in counties, education/early child development, county trade development and regulation among others, has brought about positive change in counties. It has led to advancements in infrastructural development and increased accessibility and provision of social and economic services. Public service delivery and development have been essential for meeting multiple goals beyond economic betterment, including social justice, security, inclusion and empowerment. People are able to see the benefits and fruits of inclusion in civic affairs, including governance at the county level, where their input has the potential to translate into tangible benefits and improvements in their lives.

Devolution has led to a tangible improvement in the lives of most residents within the counties under examination and has the potential to do so throughout Kenya. It is no wonder that the public is optimistic about devolution and its future within Kenya, even in counties that have had limited development. Devolution appears to be an effective tool for improving service delivery and ensuring greater development within counties, if it is effectively implemented in a transparent manner and through bottom-up processes involving locals. It is also necessary for duty-bearers to comply with the provisions of the Constitution, as well as other relevant legislative Acts, in order for devolution to be effectively implemented.

87 Article 189 of the Constitution of Kenya, 2010.

68

G.2. Revenue Allocation and Inter-Governmental Relations The move to a devolved system of resource distribution was a big step for Kenya on the path of ensuring equitable development for all. Several challenges that were identified during implementation need to be addressed for devolution to deliver the results hoped for. An integral legal framework gathering and harmonizing all national and subnational legislation with the Constitution can be a useful tool to avoid discrepancies and conflict of legal nature between law texts governing revenue allocation and intergovernmental overlaps. Moreover, spreading literacy and education on the legislative side of revenue allocation and collection is needed especially at the county level. The interviewees from civil society groups reported a remarkable illiteracy among County Assembly Members on related matters. The CEO of the Law Reform Commission indicated that there is a lack in county acts allowing revenue generation. He mentioned that many sources of valuable revenue through taxation are neglected because of the non-existing legislation by county assemblies. This is due to a deficiency in training and capacity building at the county assembly level.

Additionally, a cultural shift is needed to fight corruption that has plagued the country for long and continues to deplete its resources. The legal framework was reported to be sufficient for accountability to take shape on the ground. This has been proven by tens if not more of scandals of corruption by public officials and institutions taken to court on a weekly basis. Yet, this remains an ongoing costly process for the public finances and it has negative repercussions on the reputation of the economy both nationally and internationally. Thus, the problem needs to be tackled at its roots starting at the community level by combatting the cultural paradigm summarized in the widely used expression “it is our time to eat”.

G3. Inclusion, Public Participation and Role of Civil Society Despite the challenges of implementation, many opportunities remain for the future of public participation in devolution. A report commissioned by the Intergovernmental Relations Technical Committee on the status of public participation in Kenya detailed a series of legal cases filed against various arms of the national government, as well as some county governments. These cases challenged the lack of public participation in job appointments, policy legislations, budgeting and planning processes, and other areas. Some of these legal challenges were successful, while others were not.88 Regardless of success, this is a clear indication that people are using the legal structures to mobilize and claim the benefits of public participation. Additionally, various civil society organizations have banded together to establish a network that aims to “support the creation, reclamation, and preservation of civic cases in Kenya, and beyond.”89 Such actions from citizens and civil society organizations will go a long way toward making sure that public participation is not mere rhetoric and lip service.

The example provided by Makueni County, as the strongest county on public participation, brings inspiration to other counties in Kenya. In August 2018, 46 County Governors visited Makueni County for a benchmarking exercise on public participation as well as to share lessons learned on 88 The Status of Public Participation in National and County Governments. Intergovernmental Relations Technical Committee. Nairobi, Kenya, pp 24-27. 89 Kenya Human Rights Commission. (October 2016). Towards a Protected and Expanded Civic Space in Kenya and Beyond: A Status Report and Strategy Paper Developed for the Civil Society Sector in Kenya. Nairobi, Kenya. p 8

69

devolution.90 The country hails Makueni as a first of its kind that will hopefully inform future inter-county collaboration and cooperation. So far, there have been six other counties that have passed and institutionalized their own public participation acts, namely, Nairobi, Laikipia, Busia, Wajir, Nyeri and Elgeyo Marakwet. Both the Kenyan Law Reform Commission (KLRC) and The Institute for Social Accountability (TISA) have developed frameworks and models for public participation laws that counties can adopt and customize as their own.91

Elgeyo Marakwet county has also initiated partnership with development actors to start collecting data at the village level and to establish their own databases related to poverty indicators, level of education, types of employment, etc. The data gathered will certainly help in drafting evidence-based planning. While these are commendable developments, respondents also highlighted the need to establish monitoring and assessment mechanisms that provide status updates on various aspects of devolution to both the public and the counties. CSOs also pointed out the importance of overhauling the Public Procurement and Disposal Act and rendering the procurement process more responsive to public participation. The passage of the Public Participation Bill is a priority that CSOs will continue to push for and that they hope the government will approve in 2018.

90See: https://www.the-star.co.ke/news/2018/08/27/governors-troop-to-makueni-to-assess-progress_c1808446 91 The six counties were identified as of 2016. Please see: The Status of Public Participation in National and County Governments. Intergovernmental Relations Technical Committee. Nairobi, Kenya, p 30.

70

Asmaa is president and founder of the Moroccan Witness Association where she works on youth civic education with a focus on promoting their involvement in public affairs.

Dorcas worked as a market and social research executive. She looks forward to monitoring and evaluating social interventions projects.

Loyce is a legal and multidisciplinary researcher, analyzing issues related to children, persons with disabilities, and constitutional and human rights.

Rhea worked in the Philippines on community development, international peacebuilding, and conflict transformation.