Overview Document

Kenya, like all African countries, focused on poverty alleviation at independence, perhaps due to the level of vulnerability of its populations but also as a result of the ‘trickle down’ economic discourses of the time, which assumed that poverty rather than distribution mattered. In other words, it was only necessary to grow the economy because, as the country grew richer, the wealth would trickle down to benefit the poorest sections of society. While the country has registered remarkable economic performance, extreme poverty has not been eliminated and inequality has not only persisted but deepened. 

Why does equity matter in Kenya?

First, the Constitution clearly specifies that equity is an expected outcome. Specifically, clause 201 states that the public finance system is to promote an equitable society in that revenue raised nationally shall be shared equally between national and county governments and in the promotion of equitable development, and expenditures will be oriented towards addressing the needs of marginalised groups and regions.

In terms of resources to be allocated to the county level, under clause 203, specific reference is made to the allocation of resources guided by the developmental and other needs of counties according to economic disparities within and among counties; the need for affirmative action; and the need for economic optimisation of each county. The Equalisation Fund (created under clause 204) will see 0.5 percent of all nationally collected revenues directed towards the provision of water, roads, health and electricity to marginalised areas to the extent necessary to bring the quality of those services in those areas to the level generally enjoyed by the rest of the nation.

Second, inequality across regions is frequently discussed and is an emotive issue in Kenya. These differences in development outcome are partly attributed to structural disparities in accessing opportunities. Thus some regions like Nairobi have a Human Development Index (HDI)1 of 0.773 and are comparable to high HDI countries like Seychelles (0.773) and Mexico (0.770). The Central region (0.637) can be compared to medium HDI countries like Egypt (0.644) and Botswana (0.633) while parts of the Northern region (0.417) can be compared to low HDI countries like Malawi and Afghanistan. The regions considered to be doing well on average also have huge dis­parities within them. The Rift Valley region, for example, has an average HDI of 0.574 but Turkana registers an HDI of 0.33 while Uasin Gishu registers an HDI of 0.63 which is twice that of Turkana. These extreme differences make it imperative to revisit the issue of regional inequality, especially now that the country is undertaking an ambitious devolution programme. 

Third, in the past decade when Kenya’s macroeconomic policies stabilised and the economy grew more rapidly, most Kenyans did not see sufficient or broad sharing of the resources generated under the centralised system. Kenyans therefore have high hopes that devolution will lead to fairer sharing of resources and more widespread development that will improve their lives.