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We must shrink our government to grow

Monday November 9 2015

By BITANGE NDEMO
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The size of government is a serious social, political and economic issue in many countries. Without fanfare, and sometimes with glitz, government balloons into a behemoth of untold proportions. 

In most countries, no one can tell the size of government. It is the known unknown. And it gets even stranger. The larger the government becomes, the more difficult it is to scale it down. 

Former US President Ronald Reagan once said, “No government ever voluntarily reduces itself in size. Government programs, once launched, never disappear. Actually, a government bureau is the nearest thing to eternal life we'll ever see on this earth!”

Citizens are therefore stuck with state agencies that were created years ago but have no relevance today. 

There was hope that Kenya would finally reduce the size of her government when the Jubilee government created a task force to reform state agencies. Although the task force finished its report and made some recommendations, implementation of the report was shelved.   

Perhaps there was lobbying behind the scenes to retain even the agencies that are draining the Exchequer and have no relevance in Kenya today.

In a recent social media post, someone asked, “Of what value for example are the Kenya National Trading Corporation, Industrial Development Corporation, Development Bank, and Tourism Finance Corporation to the economy?” 

While some of these institutions were needed by the young postcolonial government in the early 1960s, clearly, they are now redundant, and the private sector is more effective and efficient in the services they used to offer. If they were closed down today, most likely no one would notice.

Like the state agencies reform report noted, we have lost opportunities in utilising these agencies for greater economic development.

It is about time we started to also make the size of government part of our political, social and economic discourse. By this, I am not in any way suggesting that state agencies have no role to play in economic development – some have and indeed do play a significant role. 

However, I am of the view that we should get rid of non-performing commercial state agencies and corporatise or privatise all other commercial state agencies. In Australia, for example, radiology services are corporatised.

Kenya Commercial Bank, which was at some point wholly owned by the Government, was privatised and listed on the Nairobi Stock Exchange. Since then, the government has never gone to rescue KCB as used to happen when the government owned it.

EXPENSIVE WATER

The once mammoth Kenya Posts and Telecommunications Corporation was restructured and some of its specialised units privatised. Although this was a painful decision considering the company was considered a strategic security organisation, the industry is better off today than if we had continued protecting it. 

The sector indeed contributes hugely to economic progress of the country. We must courageously continue to take these painful decisions and prudently reform where necessary.

Some reforms never really make sense. Take for example the 2002 water reforms that created eight new entities to manage water and catchment areas.  

These were purely new layers added to existing non-performing municipal entities such as Nairobi Water, which in law is simply an agent of Athi Water Services Board. 

When creating new state agencies, we must always be cognisant of service delivery to citizens in the most affordable ways. As if to confirm President Regan’s thesis, it is now difficult to remove the glaring duplication of water services in the country. 

To make matters worse, this duplication is making water unnecessarily expensive. Water, an essential commodity, has been made expensive for no good reason.

The management of our public universities has come under scrutiny in the past few weeks. We hope that the reforms suggested by the minister for Education, Prof Jacob Kaimenyi, will bear some fruit. 

INTEGRATIVE ETHOS

In my opinion, the task force’s terms of reference should be guided by the following question: Why should we be having several chancellors and councils in public universities when advanced countries manage several public institutions under a single council? 

We have a chance to radically reform higher education in a manner likely to promote greater integration of our people than ever before.   We must begin with the reduction of the bloated system.   

Amalgamate all public universities into one giant University of Kenya with several campuses around the country.  Perhaps the best example that we should emulate is the State University of New York that has 64 campuses across the State of New York under one administrative unit with one Chancellor. 

We then must break down these institutions into their own specialisations such that Pwani University would focus on Marine Sciences and Oceanography, Egerton University on Agricultural Sciences, Garissa University on Drylands Research and Livestock Development, and so on. Because of its size, the University of Nairobi could remain as is today. 

The net effect of these proposed changes would be a redistribution of students from different counties across the country and a new beginning to building the country under a more integrative ethos.

As things are now, a student can stay in one locality from primary to PhD, and go on to teach in a local college.

Other benefits include the fact that the current competition for students would cease, paving way for true learning. There will be cost reductions, given that there will be no need for Moi University, for example, to have a campus in Nairobi. 

'TRIBAL ENCLAVES'

There will be no need for the current spend on the many councils that run the universities. 

With one employer, it will be easier to implement constitutional dictates of diversity by mass transferring lecturers across public institutions countrywide. This would strike a huge blow against tribalism. Such reforms could be the much-needed spark plug for unity in our country.

The next target for reducing the size of government is duplication in the national and county governments. Billions are being wasted at county level where county governments have hired their own staff, leaving national government staff who have always been there with nothing to do. 

A decision must be made and the National Cohesion and Integration Commission should lead on it. Governors should not create tribal enclaves at county level when the constitution is seeking diversity.

Those county leaders who have duplicated employment should be made to apply the accounting principle of Last in First Out (LIFO) principle to let go redundant staff and let it be a lesson to future governors. 

In the spirit of our Constitution, national government employees should work anywhere in the country. 

Our moral test is not how many relatives we hired in our counties but how tolerant we become to those we call outsiders for the sake of unity in our beloved country.

The writer is an associate professor at the University of Nairobi’s Business School. Twitter:@bantigito