Counties should guard against the ‘graft-industrial complex’ to succeed

The first 100 days of the new county administrations are about to lapse.

By this stage, we had expected to behold an ultra-competitive “race to the top” among the 47 devolved units.

Truth be told, things have been much slower, not least because of the delayed disbursement of funds from the National Treasury.

Furthermore, the seemingly straightforward process of vetting county executive nominees has proved to be a thorn in the flesh, and has exposed the subterranean power games that animate county politics.

Putting it simply, it has not been a bed of roses for the newly-elected governors.

MENACE

But these procedural challenges pale in comparison to a far more potent menace which, if poorly handled, could be a threat to the entire nation – the “graft-industrial complex”.

Recently, the West Pokot County Governor suspended 23 projects to pave way for investigations into alleged corruption. He claimed millions of shillings had been paid to contractors by the previous county administration at highly inflated costs.

He went further and added that the past government initiated numerous construction projects whose sole purpose was not to improve the lives of the people but to enrich some county officials through arbitrary awards of contracts and kickbacks.

While these statements are just claims which need to be investigated, one gets the sense that all the 47 counties need to remain guarded against this most sophisticated form of corruption.

So what exactly constitutes this “graft-industrial complex”? Keen students of history will remember when the United States President Dwight Eisenhower popularised the term “military-industrial complex” to refer to the tight relationship forming between ostensibly “free-enterprise” industries and the Pentagon.

Eisenhower feared that the economy was increasingly locked into a “procurement” relationship with the military and thus to some degree was bound with vested financial interests in war-preparedness and in competition with nationally funded civilian projects.

US POLICY

He feared the growing power of this complex in shaping US policy, and not just foreign policy.

In very much the same way, the “graft-industrial” complex is like a first cousin to the military-industrial complex.

The only difference here is that the deal-makers are faceless people with a voracious appetite for county bounty. Through a well-oiled system of networks, they can influence the outcome of lucrative contracts without necessarily following due process.

Given the heavy cost outlay for many of these dubious projects, it often means that funds would have to be reallocated from other more deserving projects, ultimately resulting in less focus on the original county strategic plan.

There are many ways of destroying the “graft-industrial” complex.

First and foremost, county governments need to focus on their five-year strategic plans and decline any invitation to depart from the straight and narrow.

Governors need to be alive to the CEO-style of management and provide quarterly disclosures to their citizens in robust town-hall meetings that bring together all the stakeholders.

Quality disclosures shine light on county affairs and reduce the information asymmetry between the government and its citizens, leaving no room for clandestine activity.

A recent report on the State of the Counties revealed that ordinary citizens are thirsting for insight into what is happening in their home counties.

DELAYED PROGRESS

Everything from education and health to infrastructure and industry seem to provide fertile ground for lively conversations which once never existed due to the knowledge gap that historically existed, particularly between the public and private sectors.

Such information asymmetry has delayed progress in significant ways and has increasingly become an important topic in the field of development economics.

Indeed, many economics enthusiasts will be pleased to find out that Joseph Stiglitz, the Nobel Laureate who pioneered the area of Imperfect Information, did much of his research at University of Nairobi’s Institute of Development Studies.

In the final analysis, the real sword that will slay the “graft-industrial” complex will be a dynamic county wealth creation plan that will see income levels rise, and reduce incentives to seek proceeds of crime.

This need not be rocket science, and a simple listing of county assets will help identify revenue streams that were previously untapped.

Ensuring this revenue is efficiently collected and put into education, health care, security and innovation will see quality of life improving, attracting more investors and a more talented workforce into these regions.

This could end the unusual concentration of professionals in Nairobi and provide young educated men and women with real choice as to where they desire to live and work.

Our county leaders need to remember that they are at the frontline of Kenya’s socio-economic transformation. Good choices could usher the country into unprecedented prosperity, while poor ones will rob us of our future.

Mr Gichinga is Chief Economist at Mentoria Consulting; [email protected]