How Kenya can navigate its way out of economic storm

Kenya needs to interrogate its revenue portfolio of around Sh1.365 trillion. FILE PHOTO | NMG 

By MIKE OLIEWO

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Summary

• Taxpayers need to know if the debt that was procured, was actually used for the intended purpose or if it was diverted to other people’s pockets.
• Besides, citizens need to know how much of every debt transaction went to brokerage, commission agencies and intermediary financing facilitators.
• Kenya needs to interrogate its revenue portfolio of around Sh1.365 trillion. It is important that the country openly debates its tax net, who is out of it, who is undertaxed and who is overtaxed.

To fix the twin challenges of economic malfunction and political turbulence, there can be no doubt that Kenya urgently needs to make certain difficult decisions.

First, the country needs a serious audit of its debt burden. Citizens need to know why they owe in excess of Sh4 trillion and separate the bogus from the genuine national debt.

Taxpayers need to know if the debt that was procured, was actually used for the intended purpose or if it was diverted to other people’s pockets.

Besides, citizens need to know how much of every debt transaction went to brokerage, commission agencies and intermediary financing facilitators.

Secondly, Kenya needs to interrogate its revenue portfolio of around Sh1.365 trillion. It is important that the country openly debates its tax net, who is out of it, who is undertaxed and who is overtaxed.

The question of how much the economy can afford in tax exemptions and to what extent are the tax exemptions and tax breaks abused and misused must also be on the table.

The technical and ethical dispensation of the tax collector is worth interrogating to establish if he/she is either indifferent or complicit in tax evasion.

If tax evasion is big business in Kenya, then there is need to demonstrate our willingness to dismantle the cartels through exposure and prosecution.

Thirdly, it is now time to expose Kenya’s security budget of around $2.64 billion and audit it accordingly. It is no longer fashionable to cover the security budget in secrecy with the mischievous excuse that it might compromise national security.

The secrecy surrounding the security budget has often been used as a conduit for defrauding the nation of billions of shillings.

To effectively do this will require examining the true identities of the suppliers of military requirements and if these suppliers have remained the same over the years.

Taxpayers need to know if any of these suppliers overcharged the government, a finding that will demand they be exposed and surcharged.

It has been proven that crooked and criminal cartels always enjoy doing business with reclusive, secretive and opaque government agencies.

Fourth, Kenya needs to audit all its development budget (of 27.9 per cent), and recurrent expenditure budget allocations. It must establish the extent to which development projects have stagnated due to corrupt tendering practices, corruption-related bureaucratic bottlenecks and kickback-related scandals.

Unfinished roads, health institutions, education, water, housing, social protection and such other amenities must be deeply investigated.

Fifth, it is incumbent on Kenyans to be open and straight about the ethnic disparities. As a country Kenya must carry out an ethnic rationalisation audit.

According to the latest census results, Kenya is constituted according to tribes. It is only fair that all ethnic groups be represented on a pro-rata basis across all job groups and grades in the public service.

This does not mean that anybody should be sacked. There are many workable formulae for rationalising this exercise.

The rationalisation is important because it creates a sense of belonging and promotes patriotism. It also addresses aspects of marginalisation and historical injustices.

Finally, jobs are basically about incomes and if these incomes are fairly distributed to all corners of the country, then it becomes possible to achieve some degree of alleviating poverty, illiteracy and diseases which are historical challenges to our society.

Similarly, publicly listed companies should not be allowed to promote and entrench ethnic inequalities and disparities. By virtue of the fact that they profiteer from the Kenyan masses, they must also comply with and contribute to the national efforts in enhancing national integration, cohesion and stability.

Immediately a company gets listed in any bourse, it acquires an international face and profile. It is this face and profile which attracts members of the public to buy shares, invest in it and share in the growth and expansion of the entity. Employment policies of these entities therefore require an urgent audit, in each job group and each grade.

Sixth, it is crucial to benchmark and rationalise the spread of government-funded development projects. Kenya does not have some ground rules which govern where government-funded initiatives should be located.

READ: IMF cautions over Kenya debt vulnerability

It is the height of hypocrisy to purport to preach the gospel of equality and refuse to lay the rules for achieving the same.

How many trained teachers, qualified nurses, doctors or other government technocrats should be compulsory in a ward, constituency or county?

How many primary schools, secondary schools, polytechnics, colleges or universities should be compulsory for any given administrative unit?

How many dispensaries, health centres or hospitals should be mandatory within a locality? How about the basic minimum provision of clean water, electricity, tarmacked roads and related infrastructural projects?

We already know that humanity gets attracted to places where life seems more bearable. In modern Kenya, this attraction fuels rural-urban migration which puts a lot of pressure on the available facilities and on land.

The net effect is more neglect of rural areas and this further fuels inequalities. It is crucial to acknowledge that the whole country should develop but other parts of the country are suffering from systemic neglect and perpetual marginalisation.