MPs must play their oversight role to stem debt tide

Friday, April 12th, 2024 00:00 | By
Kenyan Parliament in session. PHOTO/Facebook/Parliament of Kenya

At a meeting organized by The Institute for Social Accountability (TISA), the Kenya National Interface Team (KNIT), and the National Democratic Institute (NDI) – Kenya, a group of progressive MPs and the civil society actors came to the conclusion that our failure to abide by the principles and framework for management of public finance is to blame for Kenya’s unsustainable public debt situation.

The deliberations were informed by a study commissioned by the NDI in 2022 to analyze the public debt situation in Kenya; review the legal framework underpinning budget and debt management processes; examine the oversight role of Parliament with respect to budget and debt management; and to review current parliamentary oversight practices with a view to identifying gaps that may require strengthening.

Titled “Role of Parliament in Pubic Debt Oversight in Kenya”, the study traced Kenya’s public debt situation to independence in 1963. The analysis paints a grim picture in which growth in spending by successive governments has consistently outstripped revenue collection.

Perhaps alive to this reality, framers of the 2010 Constitution sought to restrain this borrowing binge. Articles 201, 202 and 203 of the Constitution place citizens and Parliament at the centre of public finance and debt management.

The demand for openness and accountability, including effective public participation in the management of public finances, and entrenchment of provisions geared to ensuring that the burden and benefits of public borrowing are shared equitably between present and future generations, are some of the hallmarks of Kenya’s celebrated Constitution.

It also emerged at the meeting that whereas Parliament has largely executed its mandate in terms of transitional and consequential legislations, the NDI study unearthed a number of gaps that require redress if the principles and objects set out in the legal frameworks for public finance and debt management are to be achieved.

It is not for aesthetic appeal that framers of the Constitution put ‘the national interest’ as the primary and foremost consideration in public finance and debt management, and in all considerations preceding revenue allocation and sharing between the national and county governments.

It is the role of Parliament to come up with a Sessional Paper that defines what constitutes ‘national interest’ as envisaged under Article 203(1) (a) of the Constitution.

It was the recollection of former delegates at the Bomas Constitutional Conference, and by extension framers of the 2010 Constitution that such a blueprint would serve as the starting point for Kenya’s inconsistent quest for a national saving culture and reboot fledgling efforts like the National Social Security Fund and the controversial Social Health Insurance Fund currently being pursued by President William Ruto.

A framework on how to deal with odious debts should be put in place. Odious debts refers to moneys borrowed by a government then not used for intended purposes.

Whereas some governments in Africa have unsuccessfully argued that they are not liable to pay loans that their predecessors misappropriated, no such precedents exist in Kenya, and continued borrowing to service maturing foreign and domestic odious debts has been the rule.

Even as the debate on fake fertiliser that only Agriculture CS Mithika Linturi believes to be genuine rages on, Kenya remained indebted to Australia and Belgium until December 2019 when the country paid the final tranche of Sh2.5 billion because it had guaranteed the construction of a failed Ken-Ren Chemical and Fertiliser Plant in Changamwe, Mombasa in 1970s.

It is the hope of KNIT, TISA and the team of bipartisan MPs that a draft sessional paper, policy and regulatory frameworks being developed along the lines of the progressive recommendations in the NDI report will find favour with majority of the MPs so that together, we can put in place a more effective and robust public finance and debt management framework that adheres to the principles of intergenerational equity and fairness.

—The writer is the Executive Director of the Kenya National Civil Society Centre

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