The men who wielded the briefcase

For the 50 years of Kenya’s independence, a woman is yet to occupy the Treasury – a pivotal office in any government in the world.

Out of the 13 men who have been privileged to sit at Treasury, two have risen to the presidency – Mwai Kibaki for 12 years and Uhuru Kenyatta for three years and in two different generations.
Budget, across the globe is the most watched event on television and radio besides football and elections.

Kibaki, occupied the Treasury during much of founding president Mzee Kenyatta’s era, eight years, and three years under Daniel arap Moi, the successor who ruled for 24 years.

Kibaki, by sheer coincidence, gave a chance to Uhuru to run the Treasury during his tenancy at State House exactly 30 years from the date senior Kenyatta died on August 22, 1978.

In Europe, more than in the United States, the Finance portfolio, other than the vice-presidency or deputy premiership, is a stepping stone to becoming Prime Minister, President or the influential global money lender, International Monetary Fund, boss.

The 14th Finance Secretary under new constitutional dispensation, Henry Rotich, is yet to make a mark at the Treasury.

But the 13 others who have gone before him had interesting tenures in the office which is the lifeline of any nation.

Kibaki, a First Class economist at Makerere and later London School of Economics, became the longest serving Finance minister, for 12 years.

Prof George Saitoti, a Mathematics professor was three years shy serving only nine years. James Gichuru, the founding Finance minister, a politician of pre-independence era with not much to write home in economics did six years.

Next was former deputy Prime Minister Musalia Mudavadi — appointed to the office in his youth — impressed Kenyans and donors, did five years.

The four longest serving in the last 50 years left a mark during their different tenures – and except for Mr Gichuru, Arthur Magugu and Prof Saitoti who have since died, 10 others still live in Kenya.

Nyachae and Mudavadi have had a stub at the presidency in 2002 and 2013 respectively. We examine each one of them, the role they played in the country’s economy to celebrate half a century of independence.

James Gichuru (1963 – 1969)

Appointed in 1963, Mr James Gichuru presented six budgets which laid the economic foundation of Kenya to remain ahead in the East Africa region and the continent.

First, he banned repatriation of money by departing whites – unlike in Uganda and Tanzania where the whites were allowed to go home with money in dollars or pounds.

Instead, the policy of British government giving Kenya a loan to buy off farmers in the white highlands paid dividends.

The departing whites were paid in London and the pounds remained in the UK rather than depleting the Nairobi Treasury of the foreign exchange.

The strong Kenya shilling in the East Africa region has its roots on the Gichuru policy.

His first budget on June 16, 1964 was heavy on Defence and Agriculture.

The country’s armed forces were in their formative stages from the colonial rule and indigenous Kenyans who were buying farms in the white highlands had to get loans to buy the land.

Thus Gichuru founded the Settlement Fund Trustee (SFT), Agricultural Finance Corporation and Agricultural Development Corporation – all to deal with transfer of land and spur agricultural activity of the new nation.

And on June 10, 1965 while reading the budget that day, a parliamentary orderly moved to the dispatch box and whispered something.

The news was that his Tanzanian colleague Paul Bomani had announced that his country was breaking from common currency in East Africa and would issue notes and coins bearing the image of founding President Mwalimu Julius Nyerere.

Ugandan Finance Minister Kalule Settala had just announced the same thing in his budget reading which used to be read on same day for the three countries.

Mr Gichuru immediately went off the written text and announced that Kenya would establish its own Central Bank and issue notes and coins bearing the image of founding President Jomo Kenyatta. The new currency was issued the following year in 1966.

In his last budget, he read on June 19, 1969, he abolished the graduated personal tax (GPT) which used to be levied in villages by chiefs on behalf of local authorities.
Gichuru died in 1982 while still in the Cabinet.

Mwai Kibaki (1970 – 1982)

Kibaki took over in 1970 and for the next 12 years, he would become synonymous with the briefcase and the Kenya shilling.

He ran the economy in most trying moments of the world economy. He was at the Treasury when price control regime was at its peak, oil prices somersaulted and the country was tottering under heavy loans inflicted at independence to buy off white settlers.

Any increases in consumer good prices came to be known as “kibaki” in the villages across the country.

In his first budget on June 17, 1970, he introduced what became the bedrock of Kenya’s taxation system up to date – Indirect Tax.

Instead of paying annual tax on those owning TV and radios, he changed it to be paid for once at the source – when one is buying the TV or radio.

In the 1974 budget, he introduced the Export Compensation Scheme to encourage Kenyans to export more goods and earn the country foreign exchange.

Exporters would claim a tax refund on the goods they exported during the year to cushion their business.

It was not until Goldenberg surfaced 18 years later that Kenyans knew about the existence of Export Compensation.

In his last budget on June 16, 1981, he resorted to taxing everything imported to cushion the country from high oil prices.

During his tenure, he oversaw some of the most significant signing of local investment pacts with foreigners which have built the country.

For instance, Mumias Sugar, Nzoia Sugar, Webuye Paper Mill, Jomo Kenyatta International Airport were negotiated and signed by him.

There were also white elephants which he negotiated while at Treasury and were signed under his watch. The KenRen fertiliser plant in Mombasa, Kisumu Molasses, and the Kenya Furfural in Eldoret are some of these.

A sustained anti-Kibaki campaign launched by the then Editor-In-Chief of The Standard newspaper, George Githii, questioning his rein at Treasury was thought to have been engineered by his perceived political rival Charles Njonjo which led to his removal from the plum job in 1982.

Arthur Kinyanjui Magugu (1982-83)

Magugu, like Gichuru, did not have background in economics.

He presented two budgets whose themes centred on human health - introducing schemes aimed at building Kenya’s health sector.

For instance, he is the one who came up with the building of rural clinics on the taxpayers’ cash.

But he is most remembered as the only Finance Minister who delayed the reading of the budget by a week in 1983.

George Saitoti (1984 – 1992)

Prof Saitoti was sourced from the private sector. When nominated to Parliament after the 1983 snap election, he was a Mathematics Professor at the University of Nairobi and Chairman of Mumias Sugar Company board.

Previously, he was an MP in the East African Community Parliament which collapsed in 1977.

For nine years, he presided over Treasury against deteriorating world economy, culminating in the cutting of aid by donors in his last years at Harambee Avenue.

Saitoti found it difficult to balance budget against a world economy occasioned by wars in the Middle East (Iran-Iraq wars), which shot up oil prices.

It was under his tenure that the Export Compensation Scheme was constantly abused.

Mr Kamlesh Pattni, then a young businessman saw an opportunity and came up with a scheme of exporting jewellery – gold and diamonds – which were not being mined in Kenya.

The resultant Goldenberg scandal in which Kenya lost billions of shillings has become a permanent feature in Kenya’s history.

Wycliffe Musalia Mudavadi (1993-97)

A land economist, he has the distinction of having been the youngest minister in the office at 31 years.

He had 18 years in Parliament with an interruption of five years when he deserted Narc in 2002 back to Kanu when the Opposition wind was at its highest.

As Finance Minister in 1993, Mudavadi was praised for boldness by admitting to Parliament that the government had printed more money during the 1992 elections – the Jirongo (Sh500) notes.

As the tenant at Treasury, he set about mopping the currency from circulation and won admiration from even the Opposition.

As acting leader of Government Business in 1998, he marshalled MPs’ support to defeat Mr James Orengo’s Motion on a vote of no-confidence which threatened to bring down the Moi government.

He backed the Bill that proposed local trials for ICC suspects.

Under his watch, Mudavadi oversaw privatization of local state corporations; won back donor confidence to resume the cut foreign aid; and, established a banking industry whose bedrock continues today.

Simeon Nyachae – 1998

He is remembered as a frank Finance minister.

He openly told an MPs’ meeting at the Mombasa Serena Hotel that Kenyan economy was in the Intensive Care Unit.

At that time Mr Moi was touring South Nyanza and was riled by Nyachae’s frankness.

He returned to Nairobi and transferred him to Ministry of Trade and Industry upon which the temperamental Nyachae resigned from the Cabinet.

His abrasive style of managing the Treasury won him more enemies than friends.

For instance, he defended to the hilt key officials at the Treasury who had been implicated in some misdeeds arguing that buck stopped with him as the minister.

The radical presentation of his budget that year did not endear him to his political enemies.

For instance, Nyachae returned capital gain tax which angered the wealthy landlords who sold property and paid tax.

Francis Yekoyada Masakhalia – 1999
He was a technocrat at the Treasury and well-versed in Finance long before he was appointed minister.

He rose through government ranks to become the Permanent Secretary from where he was sacked by Mr Moi for employing people from his Busia home county.

Despite his experience and knowledge in finance, his stewardship at Harambee Avenue did not reverse the downturn trend of Kenyan economy where growth went below zero.

He is the Finance minister who began the Medium Term Expert Framework – a three year budgeting system in which the country projects future spending.

Chrysanthus Okemo (1999 – 2001)

He is one of the Finance Ministers from the private sector who was in the Dream Team through which Mr Moi wanted to bring about economic restitution ahead of the third multi-party elections.

Mr Moi’s desire was to leave a legacy on the economic map of the country and sourced people from the private sector to resuscitate the economy.

He is most remembered for having scrapped duty on bicycles used as boda boda to spur transport in the countryside.

Many saw it as self-interest since the boda boda transport originated from his Busia County.

Despite his commitment to economic reforms, his tenancy at Harambee Avenue did not have much impact.

Chris Obure – 2002

He was the last Finance minister in Kanu and Moi era.

Like Nyachae and Masakhalia, he read only one budget whose big component was money to finance the year’s General Election.

He read the budget when anti-Kanu sentiments had peaked to unprecedented levels.

The Opposition was trying to unite and dislodge Kanu and the economy was in a shambles.

His term in the most powerful office was uneventful.

David Mwiraria (2003 – 2006)

He became the first Finance Minister in the post-Kanu regime.

His appointment did not come as a surprise as he was the new President Mwai Kibaki’s lieutenant.

He had been shadow Finance minister for five years when Kibaki’s Democratic Party was the Official Opposition.

He chaired the Public Accounts Committee on behalf of Kibaki for the same period.

Previously, he rose through the ranks in the civil service up to Permanent Secretary before joining politics.

The biggest challenge he faced when he sat at Harambee Avenue was financing Free Primary Education which was a campaign tug for the Narc government.

He did it with much success despite initial hiccups when children flooded primary schools in Standard One.

But the Anglo-Leasing scandal – of a similar monumental scale with Goldenberg in which Kenya lost billions of shillings – marred his tenure at the Treasury.
He resigned 10 months before completing his third year at helm.

Amos Kimunya (2006 – 2008)

He was appointed Finance minister when Kenya was under pressure to act on Anglo-Leasing scandal.

The flamboyant former MP for Kipipiri set about promising Kenyans to deal with Goldenberg and Anglo-Leasing scandals so that the country could return to good books with the donors.

But the ghosts of Goldenberg and Anglo-Leasing simply did not go away.

Then, came the controversial sale of Grand Regency Hotel plus adjacent land in Nairobi’s Central Business District to Libyans linked to the late Muammar Gaddaffi’s government.

The five-star hotel previously owned by Goldenberg architect Kamlesh Pattni was sold as restitution to billions of shillings he swindled the Treasury under the Export Compensation scheme.

A Motion moved by Kakamega Senator famously known as “Kimunya must go” led to his resignation to pave way for investigation.

He was cleared and re-appointed Trade Minister in the sunset years of Kibaki government.

Uhuru Kenyatta

The President spent 13 years uninterrupted in Parliament, three as nominated and 10 as elected MP.

The son of founding President Jomo Kenyatta and Mama Ngina, he first began in government as Local Government Minister.

He quashed nominations of councillors in a move that brought questions as to whether or not he favoured Kanu and PNU-friendly names.

He was appointed Minister for Finance to replace the late John Michuki who had been acting during Mr Kimunya’s was suspended.

As Minister for Finance, he is most remembered for the Sh10.1 billion excess money in the budget which he attributed to a ‘print error’.

He is also remembered for ordering government ministers and top civil servants to use Volkswagen Passat vehicles of no more than 2000cc to save on government spending.

Hitherto, government officials were using Mercedes Benz cars, which were fuel guzzlers.

However, in Parliament, he opposed a Bill that proposed local trials for ICC suspects, where he now finds himself answering to charges.

He resigned as Minister for Finance but continued as Deputy Prime Minister when his name popped up as one of the suspects of the 2007 post-election violence.

Robinson Njeru Githae (2011 – 2013)

He is another one who read only one budget - that of 2012.

He was the last Finance Minister in the Kibaki administration and under the old constitution, where ministers doubled as MPs.

His undoing at the Treasury was the standoff with MPs when he tried to impose tax on their incomes.

His tenure was uneventful.