Protect Hustlers Fund from fate of previous initiatives

The proposed Hustlers Fund proposed by the new government will be a plausible idea if it is given the political goodwill and impetus it has been initiated with. It must also be anchored properly in policy to avoid pitfalls that have faced many similar initiatives in the past.

The youth unemployment situation in Kenya is too grave for a serious government to ignore. It is noteworthy that youth aged between 15-34 years constitute about 70 per cent of the Working Age Population, an equivalent of 19.8 million people. This bracket is, however, the largest among the unemployed.

To start with , the government should train or establish incubation centres to equip the youth with the necessary business management skills that includes proper bookkeeping and accounting to allow them an opportunity to attract financing from banks and other financial institutions.

There is also an urgent need to formalise the informal segment of the Small and Medium Enterprises (SME) sector through the promotion and simplification of business start-up operations.

By formalising these entities, many more people, particularly the youth would gain an identity and in the process, open themselves up for more business opportunities along their value chains.

Second, we need to develop and implement the SMEs’ subcontracting policy. This should aim at promoting the creation of strong linkages between large enterprises and SMEs whilst governing the contractual agreements between the two. This will not only boost the growth of the SMEs, but will also result in the growth of the value chains, catalyzing a more vibrant economy.

Third, it is important that we foster SMEs innovation and patenting. The SMEs sector competitiveness and the exploitation of economies of scale are largely determined by the quality of products developed and the right pricing.

At the grassroots level, there is a need to help the beneficiaries, who are largely ill-educated, to organise themselves into business groups so that they can be able to pool both human skills and other resources that are needed to run businesses.

Also, it is imperative for the county governments to prioritise and create an enabling environment for job creation particularly for the youth. This includes establishment of markets and other basic services such water and other health facilities such as toilets and security lights in business centres.

If Kenya wants to ensure its stability and prosperity, we must establish and support more opportunities for young entrepreneurs. Also, the country should establish youth-friendly financial services.

The procurement rules requiring the government to procure its 30 per cent of goods and services from the youth was a good idea that the Hustler Fund can leverage. One of the greatest challenges that has failed the rule is lack of working capital among the youth.

Although they have registered entities to do business with the government, the jobs end up going to those with capital who finance youth’s business and take the lion’s share of the profit leaving the business owners impoverished. Also, delays in paying suppliers by the government has left those without enough working capital dry.

A number of policies, programmes and initiatives that have been crafted to try and address youth unemployment may offer vital lessons. These include the National Youth Service (NYS), Youth Polytechnics, Youth Empowerment Centres, Youth Enterprise and Development Fund (YEDF) and Kenya Youth Empowerment Project that included Kazi Kwa Vijana-KKV.

The writer is a Public Policy Analyst