As the corrupt loot public coffers dry, it is the poor who are left to suffer most
What you need to know:
To prevent Kenya sliding into a total failed state, the government must emulate the countries that have successfully fought off the ogre of corruption and prospered
This is the message that Kenyans on Twitter were sending when they called for the rich and mighty to face the same fate as the weak and the poor.
But this outrage needs to be amplified if it is to achieve the desired results, and this will not happen only on social media.
The worst thing about grand corruption is that there are too few beneficiaries and far too many losers. The people who get the short end of the stick all the time are the poor, who lose out on public goods, and the diligent taxpayers, whose efforts at building the nation are made a mockery of.
The biggest threat posed by grand corruption to public welfare is that it diverts money meant to increase citizens’ access to important services such as health and education. In countries like Kenya, access to health and education through public institutions is primarily meant to benefit the poor. The rich can get treatment in private hospitals, or abroad, and they can send their children to private schools, too. This is to say that when large amounts of tax cash are stolen, the cartels of dubious “enterprises” are stealing from the masses with the connivance of greedy public officials who have no regard for citizens’ welfare. That is why the government cannot find the money to pay doctors and teachers, even if they were to strike for eternity.
POOR FAMILIES
In effect, corruption on the scale perpetuated at the National Youth Service and the cereals board diminishes the capacity of the State to offer services to wananchi. It is, for instance, instructive, that when the Ministry of Education released a circular on capitation for primary school pupils last month, there was no money allocated for buying text books either for the learners or the teachers. According to the circular, each child in Kenyan public schools is to get Sh213 in the second term, while each school will get Sh186.70 per child for exigencies such as wages for support staff and repairs. Compare and contrast these with the Sh60 million that NYS paid to Ms Anne Wangui Ngirita, even without evidence that she had supplied anything to the agency meant to train youths from primarily poor families.
At the end of the day, it is the poor who are hurt the most by this kind of larceny. And even if State players like the police and prosecutors pledge to nail the corrupt, little progress will be made in the fight against corruption because the networks of beneficiaries are joined at the hip. In the end, even the noises that government honchos make when pledging to fight corruption will remain mere platitudes. They are a balm to the support base, to create the illusion that something is being done. The reality is that some of those in government offices are beneficiaries because there can be no corruption without the involvement of public officers.
REDUCE INEQUALITY
Those in government want the money so that they can perpetuate their hold on power while those in business want their share so that they can consolidate their social influence and ability to do bigger businesses, even when such enterprises are neither creating jobs nor growing the economy. There is no way, under such circumstances, that Kenya can either reduce inequality or grow into a middle income economy with a high quality of life for all its citizens.
As such, these ideals will remain a distant dream for the vast majority because the money to turn this dream into a reality remains in the hands of a few. This is what makes grand corruption so dangerous. It is a threat to social stability and economic progress, both of which are important for medium and long-term national growth.
As politicians from the Rift Valley have said, the biggest casualties of the cereals board scandal are ordinary farmers and their families. A handful of “suppliers” have not only eaten their lunch but also run away with their children’s school fees.
Now, the small-scale farmers who actually spent time tilling their land cannot take their children to school because they simply have not been paid. And the money for payouts has probably run out. God bless them if they or their loved ones fall sick.
DEEPER MISERY
Yet, as Agriculture CS Mwangi Kiunjuri told Parliament on Wednesday, there are eight people who, between them, pocketed Sh1.8 billion. That translates to an average of Sh225 million for each supplier. What makes the case worse is that some of them were paid immediately. This is a classic example of the rich getting instantly richer and the poor sinking deeper into misery.
In their study of graft in Afghanistan, three scholars – Manija Gardizi, Karen Hussmann and Yama Torabi – noted that “grand corruption usually involves twisting the rules for private sector interests and for significant personal or group enrichment”. That is why, in their view, traditional anti-corruption mechanisms are insufficient.
“Many corrupt practices are not isolated individual acts but instruments for the benefit of groups and networks,” they said in their study, Corrupting the State or State-Crafted Corruption?
Given their argument, should Kenyans entertain any hope that charging the NYS officials and their “free market” accomplices will bring them to justice? Will those found culpable be made to return their ill-gotten public wealth? To answer these questions, let us examine the handling of the most recent corruption case.
PRIVATE ENTERPRISE
Two weeks ago, former Permanent Secretary Sammy Kirui and former Nairobi Town Clerk John Gakuo were found guilty of abuse of office over the controversial purchase of Nairobi cemetery land worth Sh283,200,000. In a classic exemplification of grand corruption, the irregular payment was made to a private enterprise, Naen Rech Ltd, but at the end of the transaction, there was no land for Nairobi’s poor to bury their dead. Both Kirui and Gakuo were jailed for three years and fined Sh1 million each. There was no mention of recovering the lost money or surcharging the officials for the loss.
According to the International Journal of Economics, Commerce and Management, political corruption, like the kind rampant in Kenya, “impedes the capacity of a State to grow”.
“Corruption weakens public service delivery, misdirects public resources, and holds back the growth that is necessary to pull people out of poverty,” writes Rashidat S. Akande in his article, “Corruption and State Capacity in Sub-Saharan Africa,” published in volume five of the journal.
He warns that policy makers can distort policies to meet the interests of the corrupt when they should be serving a greater public good. This can be manifested in various forms, such as giving higher allocations to public institutions targeted for plunder or aligning the pet projects of robber barons with party manifestos and government policies.
TRADE BALANCE
The other ugly face of grand corruption such as that witnessed at NYS and the cereals board is that it affects the quality of investments. Suppliers and contractors with dubious credentials are paid mind-boggling sums of money without creating jobs, building industries or making any serious investments in the factors of production. In turn, they can only use their ill-gotten incomes on high-value imports such as luxury goods. This, in turn, erodes the country’s balance of trade, meaning that we spend more dollars buying as a country than we earn from exports.
There is also the money element to it.
“Fiscal capacity is an important aspect of State capacity. A reduction in efficiency in this branch of the government is likely to mean that fewer returns are processed and when individuals’ living standards are squeezed; their incentive to accept bribes in lieu of collecting taxes is increased,” writes Akande.
PAYING DEBT
The upshot of this is that tax revenues are depressed, meaning that the government will be hard-pressed to meet its obligations, including paying debt. Already, we have witnessed in the last two weeks, an attempt to re-organise the board of the Kenya Revenue Authority, a move that has been challenged in court.
“Ajazand Ahmed (2010) analysed the effect of corruption and governance on tax revenue in 25 developing countries and the result showed corruption has a significant effect on taxes,” Akande argues.
Whichever way one looks at it, one sees Kenya going through the throes of all these symptoms, all of which point to the State’s diminishing capacity to do its job effectively, efficiently or at all. The result is a growing tide of public disillusionment and a cynical conviction that there is nothing the State or its agencies, such as the courts and the police, can do to make a meaningful change and to truly fight corruption. Already, the handwriting is on the social media walls of Kenyans, who are showing their impatience even with those who are claiming to be sick and tired of corruption.
ROLE MODELS
The next question then is: What is to be done? First, there is need for a critical mass of sufficiently angry citizens who must rise to demand an end to impunity. Role models abound, from Guatemala to Malaysia, Brazil to South Africa, Burkina Faso to South Korea, where the populace has in the recent past taken it upon itself to pile pressure on their governments to take action against the corrupt.
Sarah Chayes, in a paper she published last month titled Fighting the Hydra: Lessons from Worldwide Protests against Corruption, also proposed the protection and strengthening of the institutions that enforce the law, especially the courts, to ensure that the law applies to the powerful as it does to the weak. This is the message that Kenyans on Twitter were sending when they called for the rich and mighty to face the same fate as the weak and the poor. But this outrage needs to be amplified if it is to achieve the desired results, and this will not happen only on social media.
Mr Mbugua is the Editor of the Saturday Nation.
