The enactment of a new Constitution in Kenya in 2010 was seen as a solution to poor governance, unfavorable economic policies and imprudent resource management. This was highly anticipated to spur equitable growth, improve Kenya’s public financial management and create varied economic opportunities under the devolution framework. Notwithstanding these prospects, a study of the cost implications of the constitutional dispensation highlights the lack of a proper costing matrix in implementing the new constitution characterized by increased financial pressures, higher taxation, external borrowing to finance a bulging and unplanned wage bill and the misuse of public funds. Coupled with the inherent challenges of significant revenue shortfalls, delayed institutional transitions and slow absorption of development funds and external financing, this poses potential risks to sustainable future budget financing.
The findings of this study were published in an article titled “The Cost of Devolution in Kenya: A Cost Analysis of the New Governance Framework Introduced by the 2010 Constitution of Kenya and Its Impact on the Country’s Public Finance” in the Africa Policy Journal, Volume X, pp.28-58, 2015 of the John F. Kennedy School of Government, Harvard University. The publication was co-authored by Dr. Luis Franceschi (Dean, Strathmore Law School), Shillah Memusi (BCom Class of 2010) and Reuben Muhindi (SFAE graduand 2015). This study was conducted under the Strathmore Law and Policy Institute (SLPI), a research centre at the Strathmore Law School.
The study analyzes in depth the costs associated with new Executive and Legislative structures at both the national and county levels of government, constitutional commissions, independent offices and other constitutionally created offices, and characterizes the impact on the country’s revenue generation and expenditure patterns. The authors emphasize “the need for the necessary government departments… to be deliberately conscious of the cost of the new Constitution, the opportunity cost of the widened government expenditure, and the effects these costs have on the country’s positioning and future prospects as regards the welfare.” It is thus essential for constitutional drafters to be explicit with and experienced on cost analysis and financial implications when presenting draft legislation and/or amendment bills. This is especially so because effective governance calls for the management of public expectations and the creation of realistic scenarios in institutional reforms undertakings that take into account the impact the same would have on the taxpayers.
Dr. Luis G. Franceschi is the Dean of Strathmore Law School and holds an LL.B. (UCAB), LL.M. (Nairobi) and LL.D. (Navarre) with a cum laude thesis on the African Human Rights judicial system. He has been teaching constitutional and international law and has published widely on law and ethics. His latest publications are The African Human Rights Judicial System, published in February 2014, and The Constitution of Kenya 2010: A Commentary, a 900-page commentary on the Constitution of Kenya, coauthored with Professor PLO Lumumba and published in July 2014.
Shillah Memusi, a Chevening Scholar, is a Research Fellow at the Strathmore Law and Policy Institute. She holds a MSc. in Poverty and development from the Institute for Development Policy and Management at the University of Manchester. She has keen interest in participatory governance, gender and development, and representations. She will soon begin her doctoral research at the Bayreuth International Graduate School of African Studies, Germany.
Reuben Muhindi recently completed his Bachelor of Business Science in Financial Economics (BBS-FE) degree in the School of Finance and Applied Economics and will be graduating in June 2015. His research interests are in development economics, monetary economics and public policy. As a research assistant at the Strathmore Law and Policy Institute, he has been involved in statistical and financial analysis of institutional reforms during his undergraduate studies and hopes to enroll for a Masters or direct PhD program in Economics soon.
The Harvard Africa Policy Journal (APJ) is a publication dedicated to promoting dialogue about African policy and current affairs in the realms of governance, law, education, business, health, design and culture. The Journal was initially started by the Harvard Kennedy School of Government but has recently expanded to encompass all the schools of Harvard University. As the only student journal in America dedicated exclusively to African policy issues, APJ seeks to publish thought-provoking content that provides fresh insight into the most significant opportunities and challenges facing African nations and peoples today.