CDF projects hit by Treasury cash delay

Public projects in Kenya are running behind because of delayed release of billions of shillings set aside in the Budget. The affected projects are in education, labour, health, planning and national development, according to Daily Nation investigations.

Also affected is the free primary education programme, the Kazi kwa Vijana (Jobs for Youth) initiative, projects under the Constituency Development Fund and the recently launched economic stimulus package, which may not take off at all, according to Planning minister Wycliffe Oparanya.

Future violence

Various commissions set up under the Agenda Four of the National Accord, which chief mediator Kofi Annan and the Panel of Eminent Personalities says are crucial in preventing future violence, are also affected, the Daily Nation has learnt.

“It is true that the release of money for the projects has been erratic,” Mr Oparanya said. “I’m not even sure whether some of these projects will be implemented this (financial) year.” The economy has slowed down, with projected growth of less than three per cent, down from a high of seven per cent. The reduced level of economic activity means income from taxes is down.

A long drought has exposed 10 million people to the danger of starvation, forcing the government to spend a lot of its money importing food and subsidising agriculture. There have also been costs associated with the political violence in 2008, such as the resettlement of displaced people.

On top of that, the power-sharing agreement produced the largest and possibly most expensive government in Kenyan history. One of the early casualties of the resulting economic stress are projects under the CDF, beloved of MPs and the public, which distributes money to the grassroots.

Running late

CDF projects are behind schedule because nearly Sh4 billion which was to be released in the first six months of the current financial year (the government accounting year begins in July), is yet to be released, according to the chairman of the parliamentary departmental committee in charge of CDF allocations, Mr Ekwee Ethuro.

Finance minister Uhuru Kenyatta allocated Sh12.3 billion to CDF projects this financial year. “We should have received at least half of the amount to cover the first and second quarters,” said Mr Ethuro. Treasury has released Sh2.4 billion, which is not enough to cover the requirements for one quarter, said the Turkana Central MP.

Also running late are projects under the economic stimulus package, an ambitious Sh22 billion investment initiative proposed by the Finance ministry during the current financial year. In a policy document released recently, the government termed the package a “high impact intensive programme” to stimulate economic activity at the local level by creating employment opportunities.

It would also spur entrepreneurial activities and support the building blocks to ensure a healthy and educated populace, according to the Economic Stimulus Programme document. If all had gone according to plan, all the projects under the package were to be implemented by December 31, only two months away.

However, it was not until last Wednesday when the Treasury released the guidelines for project implementation. “Not a single shilling has been disbursed so far,” Mr Ethuro said. “We are under a lot of pressure from our constituents because all the projects (under the stimulus programme) were to be implemented under the CDF framework.”

Under the package, each of the 210 constituencies was to receive Sh105 million for various projects. They include the construction of two primary schools in each constituency and the conversion of one secondary school in each constituency into a “centre of excellence”.

Another major project reported to have stalled is the Kazi kwa Vijana (KKV) initiative, with reports that as much as Sh6.6 billion set aside remained unaccounted for as at the end of last week. Prime Minister Raila Odinga said recently that the projects risked stalling when he called for an audit into how the money had been used.

Ministries implementing Kazi kwa Vijana had complained of delays in the release of funds from the Treasury, prompting the PM’s call. Mr Kenyatta and Treasury PS Joseph Kinyua are out of the country on official business.