Perils and potential of the new Marginalization Policy

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The second-generation Marginalization Policy was launched last week by the Commission on Revenue Allocation (CRA). This policy which appears set to alter the way equalization funds will be disbursed and used in the next five years, is the first significant contribution of the recently constituted CRA under the leadership of the affable former World Bank economist, Dr Jane Kiringai.

Article 216(4) of the Constitution enjoins CRA to formulate and keep under review a Marginalization Policy to identify “marginalized areas” to benefit from the equalization fund. The fund is a constitutional earmark of 0.5 per cent of annual revenue to be used to “provide basic services including; water, roads, health facilities and electricity to “marginalised areas,” as urged by article 204(2).

In 2013, Kiringai’s predecessor, the former CBK governor Micah Cheserem’s CRA, formulated the very first marginalization policy, implemented in 2014-2017 with over Sh11 billion allocated for equitable disbursement among 14 counties of Northern Kenya and the Coast (Turkana, Pokot, Marsabit, Isiolo, Samburu, Mandera, Wajir, Garissa, Lamu, Tana River, Kwale, Kilifi, Taita Taveta and Narok).

Cheserem’s team at CRA took a broader and intuitive view of “marginalised areas” informed by studies on ethno-regional inequalities in the country. It accepted that the economic discrimination unleashed post- independence by sessional paper No. 10 of 1965, and its progeny of policies had undermined economic productivity in northern parts of Kenya, rendering the region as a block, the least developed and thus vulnerable to conflict.

Data shows that, despite devolution and enabling policies since 2010, the rate of poverty for instance in Turkana county, stands at 94.3 per cent higher than the national average of 45.9 per cent, demonstrating how little this historical legacy of marginality has changed.

Dr Kiringai’s CRA departs from the assumptions that informed the first policy in at least two ways. First, it re-defines and expands the scope of “marginalised areas” for purposes of determining the areas to participate in the equalization funding. It argues that the existence of “pockets of marginalised areas and communities” within relatively developed counties, making the use of the county as a basic unit for identifying marginalised areas otiose. Second, it proposes that, the equalization fund should be applied towards responding to the challenges of minorities writ large– from the El Molo of L. Turkana to the Sengwer of Cherangani- in line with article 56 of the constitution.

Using the foregoing assumptions and inspired by the principles of subsidiarity and equity, CRA proceeded to formulate a “deprivation index” using five social economic parameters: primary education, secondary education, water, electricity, and sanitation.  As a result, CRA identified 1,424 administrative Divisions across the 47 counties as “marginalized areas”.

Laudable as it may be, in seeking to expand the beneficiaries of equalization funds beyond the 14 counties identified by the earlier policy, the current policy’s premises are questionable. Admittedly, article 56 of the constitution enjoins government to put in place “affirmative action programmes” to enable minorities to have inter alia “reasonable access to water, health services and infrastructure.” CRA now proposes that the equalization fund should be understood as part of this affirmative action menu of programmes available to a broad range of minorities, hence the shift from the 14 counties.

If, in fact the constitution intended the equalization fund to be part of the “affirmative action programmes” referenced in article 56, it should have made it quite plain. Instead, the constitution narrows the purpose of the fund thus: “to bring the quality of services in these (marginalized) areas to the level generally enjoyed by the rest of the nation, as far as possible.” The empirical question that CRA must then answer is, whether the past 5 years’ disbursement of equalization funds to the 14 counties has actualized this constitutional intent. It has not.

CRA admits as much in the policy as it raises efficiency questions on the implementation of the fund over the last five years. These concerns center on the institutional mechanisms for disbursements of equalization funds, project identification processes, and the rate of uptake of the funds by counties. The Policy argues that “projects proposed under the first policy failed to benefit from broad public participation, spanned too many sectors, were not well targeted and suffered from slow disbursement of funds.”  It then proposes to improve the structure of implementation by creating Project Implementation Units at “divisional level with Assistant County Commissioner as the Chair.”

While accurate in diagnosing the challenges of implementation during the initial phase of the fund, CRA’s prognosis to broaden the areas to benefit from equalization fund is disingenuous (and arguably unconstitutional). The objective of the fund, namely to accelerate infrastructural development in the North and bring it at par with national standards, cannot be achieved by expanding the scope of beneficiaries. An expanded scope as proposed will spread the rather modest 0.5 per cent of annual revenue too thin across many units, weakening the intended impact; detracting further from the constitutional vision for the fund.

That government needs to pay greater attention to the socio-economic challenges of a plethora of minorities as envisioned under article 56 of the Constitution is not in question. However, this objective cannot be realized by weakening the objects of the equalization fund.

(Dr Sing’Oei is the Legal Advisor, Deputy President’s Office  – views articulated here are solely the author’s and not attached to his office)

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