By Justus B. Aungo, PhD
Over the years, there has been increasing public investment in transport infrastructure in Kenya both through direct budgetary allocations and private sector partnerships. For instance, in 2018, US$ 2.1 billion (representing almost 10 per cent of the entire 2018/19 annual budget) was allocated to transport infrastructure where over 50 per cent of it was availed for road projects. This was a 100 per cent increase from the previous year.
For these investments, Kenya’s road network has expanded from 160,886 kilometres in 2007 to 227,893.2 kilometres in 2018. During that time, there has been an increase in good roads from 11% to 62% across the country (Ngoo, 2015).
Why We Invest in Public Roads
The Government through the Kenya Roads Board asserts that infrastructure improvement aims to spur national economic growth and that better roads will contribute to poverty reduction by lowering the costs of goods and services, improving access to social facilities and administration centres and improving safety and security. Kenya’s current strategic investment in the road sector is aligned to the Big 4 initiative as instrumental to attaining economic development goals by 2030.
An efficient and extensive road network connecting Kenyans within and across the country’s boundaries will engineer robust socio-economic transformation. At the macro-level this is clear, but not so much at the micro-level where specific questions must be answered for effective accountability and social justice.
- What exactly do we as citizens get in return from the investments?
- If all the projects invested in were delivered successfully, what would they mean in our everyday life?
- What is their actual value to mwananchi, and how can track that value?
Value for Money Monitoring
At the heart of these questions is the need for monitoring, auditing, and evaluating the value for money (VFM) in public spending. Most agencies, especially in infrastructural investment sector, face systemic and organizational culture challenges for them to answer these questions appropriately. This is because they lack the capacity and orientation to monitor and report on value for money.
Whereas the need for value for money (VFM) auditing is explicit in both the Article 229(6) of the Constitution of Kenya, Public Audit Act (2003), the Public Procurement and Disposal Act (2015), none offers a specific procedure or methodology for compliance. Ngoo (2015) asserts that the envisioned VFM audit endeavours to examine if government undertakings, activities, systems, projects, programmes, or organisations, involving public funds have been managed about economy, efficiency, and effectiveness, aiming to lead to improvements.
Constitutional Requirement: The Auditor-General through Article 229(6) of the Constitution of Kenya is required to monitor, evaluate, and confirm that public money is applied lawfully and effectively. Furthermore, Section 29 of the Public Audit Act, 2003, bestows on the Auditor-General the sole authority to ascertain the economy, efficiency, and effectiveness with which public entities use resources put at their disposal
Social accountability and inclusion: The Constitution avers that the value of infrastructural investments is not only the economy and efficiency of utilizing the funds and getting good roads (measured in kilometres) but also in their effectiveness (functionality and usage of the outputs) and ultimately the impact the usage will have on the people’s lives. This means that the value of public investments is not in their monetary inputs and material outputs but the perception, acceptance, utility and benefits accruing to the citizens in their everyday lives as well the strategic changes they engineer in their households, communities and county including access to services, and participation in the governance and politics.
State of Public Auditing: Public roads investment monitoring has remained reliant on traditional auditing dominated by finance, engineering, procurement, and management experts. For impact assessment, economic and environmental experts have been involved, in some cases, to ascertain the economic benefits and ecological effects, respectively.
Rarely do audits involved experts in the social/personal experience of infrastructural investments. Suffice it to say that value for money has tended to mean different things to different people during auditing, mostly compliance and accountability. Auditors prioritize detecting and cataloguing of compliance failures, fraud, and waste detection with little attention on value for resources utilized procedurally.
Conceptualizing Value for Money Basic mwananchi (citizen) questions regarding what the infrastructure projects mean to their everyday lives points to the concerns about:
- the actual cost of the investments as tax payers;
- the quality and timeliness of the delivery of investment outputs;
- the actual utility and performance of the outputs; and
- their involvement in prioritizing public investment through stakeholder engagement.
The four concerns reflect the 4Es of assessing value for money- Economy, Efficiency, Effectiveness and Equity.
Monitoring and ascertaining how public infrastructure investment achieve and account for the 4Es will establish the VFM as required by the Constitution but also give us the actual value for the money invested in public infrastructure projects in the country.
Rationale for Value for Money Monitoring
From a social planning and policy perspective, infrastructure projects are not an end in themselves but building blocks of socially inclusively, equitable and working nation whose people are healthy, literate, safe, secure, productive, and active in the running of the country. The impact of the country’s infrastructure programs should be measures in terms of the social returns on the investments accruing to people and communities served by those programs. They should answer the question: how have the programs changed people’s lives? That change is the measures of their value.
Adopting the value for money monitoring in the public sector will address the challenges of economic rationalism economy, efficiency, and effectiveness and citizen participation (equity and social accountability). This rationale responds to the global advocacy for more public accountability, relevance and evidence-based demonstration of social returns on investments (Then et al., 2017). The challenge how to operationalise and embed it in the public sector organizations to herald culture change towards greater accountability to stakeholders; comply with the Auditor General and technical quality standards.
Implications on Public Infrastructure Auditing
To fully comply with the spirit of the Article 229(6) of the Constitution VFM expectations, the financial, economic, social, and environmental outputs, outcomes and impacts of public investments must be accounted for and their benefits evaluated. Furthermore, community participation and social accountability mechanisms are necessary elements for a credible and inclusive process during such auditing.
Value for Money then requires that auditing be focused on the impact of public investment projects by ascertaining and establishing the measurable social return on investments. These should become basic practices and requirements. The Auditor-General should compel all public investment infrastructure programs to conduct integrated value for money (social return on investment) monitoring and accountability and should be part and parcel of the annual auditing process.
Integrating value for money monitoring into the traditional auditing process requires multidisciplinary technical expertise which can track and evaluate the impact of the project at user level. Besides finance, procurement, and engineering, sociology, ecology, and economics experts are a basic requirement in the new way of doing business.
The level of such experts in many of the road agencies is inadequate hence more need to be either recruited or contracted. Credible reporting of VFM requires conducting routine social, environmental, and economic analyses from community and county level to regional (agencies) and national (Kenya Roads Board).
References
Ngoo, T. (2015), Value for Money Audit and its Benefits. Supreme Auditor, Issue 3.
Then, V, C. Schober, O. Rauscher and K. Kehl. 2017. Social Return on Investment Analysis: Measuring the Impact of Social Investment. Palgrave
Author
by Justus B. Aungo, PhD, Department of Sociology and Social Work, University of Nairobi, Mombasa Campus.
Picture: The new Dongo Kundu Dual carriageway in Mombasa (by the Author)
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the policy or position of the University of Nairobi.
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