Which brings me to my second point. The President should revive the National Economic and Social Council (Nesc) by allowing it to assume a higher profile in the policy-making space. Under President Mwai Kibaki, membership was broadened to include policy makers from foreign countries, including the United Kingdom, Malaysia, South Korea, and Singapore.
Indeed, it was the Nesc that developed the 30-year economic blueprint — Vision 2030, and identified the six priority sectors, and flagship projects. Under President Kenyatta, this critical source of advice to the government was put in deep freeze, its secretariat sidelined and pushed to a small office in the Co-operative Bank building in downtown Nairobi.
My third proposal for the President. Where are we right now, in so far as the fight against corruption is concerned? The priority right now for the President should be how to clean up the mess in the government’s accounting system. The time has come for him to lead and put his personal clout behind the transition from what accountants call a “cash-based accounting” system to “accrual-based accounting”.
If we can get the government to implement a properly functioning accrual-based accounting system running on a robust and well-designed integrated financial system, what ICT wonks call and Enterprise Resource Planning System, we will have made it difficult for the ilk of Josephine Kabura of the NYS scam to play their games.
Transition to accrual-based accounting, plus the complete ejection of the existing Ifmis is what will stop the perennial mad rugby-style scram, whereby unscrupulous people rush to empty the vaults of the Exchequer before the end of each financial year, as we witnessed during the Sh5 billion Afya House scandal.
Clearly, cash-based accounting is what has been feeding corruption. We are yet to embrace what accountants call ‘double-entry book-keeping’. I read somewhere that double-entry book-keeping was discovered by some Italian monk who was serving the merchants of Venice in the 12th century.
Corruption is rampant because government accounts are totally broken. It is inspiring that the National Treasury the other day put up an advert inviting a consultancy firm to advise and design the change to accrual-based accounting.
The National Treasury lamented that the system it has is dysfunctional to the extent that it is impossible to do something as rudimentary as keeping an assets register. Neither is it possible to perform regular financial reporting nor produce regular financial statements.
The mafia living off the cash-based system and siphoning off billions through the Ifmis are bound to resist fiercely. The political will for the transition to accrual-based accounting will have to come from the very top.