Reference no: EM133054235

CASE STUDY

This research paper examines the experiences and challenges of county governments in resource allocation by undertaking a budget analysis of 15 county governments. The study uses 'resource allocation' to mean the funds (monies) allocated to the three devolved functions of agriculture, health and water. The criteria on the selection of the counties included in the sample was the poverty index clustered into three namely 5 urban counties, 5 rich counties and 5 poor counties with specific focus on the three devolved functions of agriculture, health and water. The period of the study was the first term of devolution, the financial years 2013/2014 to 2017/2018.

The study examined available secondary data from the Controller of Budget (CoB), the Commission on Revenue Allocation (CRA) as well as the Auditor General's Reports on county spending. The above documents were reviewed against the Constitution of Kenya 2010 by examining the objects of devolution, compared them with the County Governments blue print on development, the County Integrated Development Plans (CIDP), the County Fiscal Strategy Papers and the actual budgets. The study findings indicate that there is consistency in allocation of resources to the three fully devolved functions of agriculture, health and water despite there being no formula for resource allocation to aid in budgeting and prioritization. In order of priority, there is more allocation to health followed by water and lastly agriculture. It was equally evident that there exists a challenge in achieving separation between the two levels of government.

The national government continues to allocate significant sums to the devolved functions. On the availability of a national policy, the study found that there is no specific policy on resource allocation to the devolved function which should have guided counties on resource allocation when undertaking budgeting in their endeavour to fulfil the objectives of devolution. On the absorption rate, the study concludes that counties face a greater challenge largely due to slow exchequer release from the national government impacting programs and development negatively. The study recommends that counties should come up with own procedures and processes including a formula for resource allocation, the need for a national policy on the devolved functions and a deliberate effort to allocate more funds at the counties to the devolved functions compared to what the national government allocates to the same functions to realize overall efficiency in resource allocation.

1. Using your knowledge of importance of research in enterprise development, discuss the importance of carrying out the study