Friday, February 02, 2007

CDF: A Pact with the Devil

I was recently amused to see Raila Odinga and President Mwai Kibaki wrestling over who deserves the credit for the poisoned chalice that is the Constituency Development Fund. The CDF was a bad idea. Actually, it was a really bad idea. The Fund violates the constitutional separation of powers (the MPs both make and implement law), gives government an excuse to abdicate its frontal role in conceiving and implementing development, and does not take into account the development status and needs of various regions, districts and constituencies. However, these concerns pale into insignificance when compared to the financial implications. For this is truly a pact with the devil. Giving MPs access to 2.5% of government expenditure under the pretext of developing their constituencies was quite simply the fiscal equivalent of letting the hyenas loose among the sheep.

The Constituencies Development Fund Act gives MPs unfettered powers to constitute and convene Constituency Development Committees which have the power to select and approve the projects to be funded. This gives the MP, to whom the CDC is beholden, total control over where the cash ends up. Now consider some of the tales that have come out of the CDF audits (which by the way are carried out by Parliament making MPs accountable only to themselves) and studies by other independent bodies.

The Kenya Times reports that 90 per cent of the sitting MPs have not only mismanaged these monies but have gone" ahead to institute CDF committees both at the village and national levels largely based on nepotism." There have been reports of MPs appointing their wives, relatives and even the relatives of their domestic staff to CDCs. In a nationwide survey conducted by the Kenya Institute of Public Research and Analysis (KIPPRA), only a paltry 15 per cent of the respondents believed there was accountability and transparency in the management of CDF money while a whopping 46% believed the cash to be widely mismanaged. The Daily Nation also reports that MPs have insisted on the money being used for projects of their own choice and in areas of their preference. In short the CDF has become a gravy train for MPs to pay their relatives and reward their supporters. Instead of devolving resources to the constituency, the CDF has proven to be devolution to Parliament.

In spite of the mounting evidence of mismanagement, MPs are said to be opposed to the National CDF Management Committee's moves to recruit qualified personnel to take full charge of the co-ordination and management of the projects being undertaken with the funds. Their reluctance is understandable considering the the money allocated to CDF has been steadily rising from 5.6 billion in 2005 to 10 billion in last year's budget. And it is set to go even higher. Last year Parliament passed a law raising the annual CDF kitty to 21 billion shillings (7% of government expenditure), an amount roughly equal to what has been disbursed under the Fund in the last four years. And it just happens that that would be implemented in an election year. This election year to be precise.

The stench of rats is in the air. Combined with the just launched Youth Enterprise Development Fund (another 1 billion shillings), the stage has been set for vote buying on the scale of Youth for Kanu in 1992. Only, instead of printing money, this time the politicians have opted to bribe voters with their own taxes.

The CDF may have been conceived in hopes of addressing the fact that development funds were not felt on the ground and infusing some rationality, fairness and regularity in the process of allocating development resources nationally, but there are better and smarter ways of doing this. There must be.

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