September 19, 2017

Public Participation in Budget Making is Important

By Phyllis Wakiaga

The budget making process is one of the ways available for citizens to participate in the governance of this country. Recently, Kenya Association of Manufacturers (KAM) in conjunction with the International Budget Partnership (IBP) held a Budget forum to discuss the Budget Policy Statement (BPS) and debt management strategy for fiscal years 2016/2017.  The aim of the budget forum was to draw proposals from industry players to be incorporated in the budget with a view to improve the business environment.  The BPS review is a critical opportunity for industry players to contribute to the budget making process in our country.

In this process, the business community is expected to give its proposals that are aimed at creating a conducive business environment, agricultural transformation, infrastructure development, human capital improvement, tax reforms. Consequently, these play an active role towards productivity enhancement and industrialization. Therefore, the forum served as a platform where industry could give their input on the steps to take towards industrialization in line with the Kenya Industrialization Transformation programme.

Crucial observations were made by the participants who closely examined the proposed Budget Policy Statement (BPS). The BPS focuses, in part, on improvement of the business environment and provisions of incentives to promote industrial development and small, medium enterprises  (SMEs). Development of Special Economic Zones (SEZs) has been prioritized including SME parks and industrial parks. The creation of the ease of doing business by focusing on six of the World Bank indicators has also been highlighted.

The focus on doing business at the counties is a critical element of the reform agenda. However, participants during the forum proposed a further comprehensive review of Kenya’s regulatory environment to eradicate double taxation and duplication that has increased the cost of doing business for manufacturers in particular and the business community in general.

Other notable observations include the share of budget going to the energy and infrastructure sector which became a concern especially to industry as it reflected a decline by 2 per cent. Infrastructure development and energy efficiency is imperative to industrial development. The BPS did not offer sufficient justification for these changes. At the same time there was a proposed increase in the governance, environment and education share. This is important, if the increases are aimed at respectively enhancing capacity of anti-corruption institutions, sustainable industrialization and skills development which are imperative to industrialization process.

The budget forum, a good example of public participation, assisted the industry to present proposals to Government and thus underpinning their importance to the growth and thriving of local businesses.  This underlines a necessity for public engagements in the building of a strong nation. Based on the budget seminar, it was evident that the Government still needs to do more to inform the public on the merits of prioritization and allocations the national and county budget processes.

As industry, we are keen to see every aspect of our concerns taken into account because more jobs and wealth creation is our country’s highest priority. The competitiveness of our country is dependent on the ability to demonstrate a progressive political atmosphere and this can only happen through public participation. Both local and foreign investors evaluate our attractiveness as a country by how much we understand government policies and our knowledge in engaging them. This in turn guarantees the growth of local businesses, flourishing of domestic markets and overall economic sustainability for our future.

 

The writer is the CEO of the Kenya Association of Manufacturers and can be reached on ceo@kam.co.ke

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