Ruto, Magara, Miguna...again, who wants to be RAO's running mate?

Nation & Standard Wrong - Treasury Right On Devolution

Assertions by Media Houses that Treasury is opposed to the devolution process are erroneous and false along the following lines of thought:

1. The whole problem revolves around revenue. Revenue does not and should not include loans and grants. The government obtains loans for specific national projects in pursuant to specific objectives set out in national policy frameworks. There is no way such conditional loans can be shared to go to different counties if agreements with lenders indicate that such loans are going to specific projects. Each county has its own policy framework and is mandated to obtain its own loans which are to be guaranteed by the central government. The central government cannot obtain loans it has guaranteed and share them with counties and at the same time loans obtained by counties will not be shared with the central government or other counties.

2. Bills proposed by the Task force at the Local Government Ministry are copy pasted from South African legislative documents that have three levels of government. These cannot be applied directly to Kenya’s situation as proposed by the Task Force on devolution

3. Asking for multiple Bills to manage government and county funds is like reversing the debate to make business registration be conducted by a central office as opposed to the multitude of offices that are handling this undertaking currently.

4. The Bills proposed by the Task Force is trying to solve problems caused by Tom Mboya's legislation that marginalised regions like the NEP in the first place by calling for development of urban centres with an assumption that development will eventually trickle down to other places.

5. The Task force is proposing federal devolution whereas devolution being sought is fiscal decentralisation. Naivasha was about preventing a majimbo form of devolution and bringing sanity to the decentralisation debate.

6. Fiscal decentralisation is a policy issue and only government should handle national policy formulation. We cannot have each county formulating its own policy because this would lead to the formulation of different VAT regimes which will destabilize the economy.

7. National policies should be handled by government with counties only handling issues such as education and Roads only to a particular level and higher levels left to the government to achieve set standards. County governments should provide for education to a primary level and the government should take up the responsibility from the secondary level to higher education levels. The same applies to the construction of roads where county governments should build roads up to a certain standard but anything beyond that should be left to the government. Overall the central government will set policy and leave the county governments to do their part.

8. There must be a formulae set in place to transfer funds equitably. Calling for equal allocation of funds will lead to underallocation of funds to areas with high demand for the same and overallocation of funds to areas with low demand.

9. The Task Force mandated to prepare the Bill is only a Task Force and does not have the same level of authority as a Commission. Their level of clearance does not even allow them to even write a letter since they act like a department inside the Local Government Ministry whose mandate was to only come up with a proposal on the devolution issue. It goes without saying that they do not have the same capacity as technocrats at the Treasury who have a much deeper understanding of fiscal decentralisation issues.

10. Kenya is a sovereign state and not composed of federal governments as those inclined towards federalism in our country would have us believe. As opposed to the United States of America who united after its Civil War, Kenya is a sovereign state that is not divided along federal lines. The US government charges federal tax on incomes and every state has it’s own state tax system. Federal tax is uniform but state taxes differ. Certain states levy higher taxes than others with others not levying certain types of taxes at all.

The Local Government’s view on the entire matter is wrong.

Another nicholasclown.