After Kenya attained its independence, there was need for the country to start its development plans. This was gradually made possible but the problem occurred where the development did not reach directly the citizens at the grass root level. Mr. Muriuki Karue a member of parliament of Ol Kalau under the KANU regime, in 1999 was able to pass a motion that required the government to set aside at least 5% of the tax collection to enhance development at the grass root level, unfortunately the motion was not passed. Mr. Karue passed the motion again, under the NARC regime and the bill was passed in 2003.
The National Government Constituencies Development Fund (NG-CDF) formerly Constituencies Development Fund (CDF), is a fund established in 2003 through an Act of Parliament, the CDF Act 2003. The Act was later reviewed by the CDF (Amendment) Act 2007, and repealed by CDF Act, 2013 which was subsequently succeeded by the current NG-CDF (Amendment) Act 2016. The main purpose of the Fund is to enhance infrastructural and socio-economic development at the grass root level in order to reduce poverty by dedicating a minimum of two and half per cent (2.5%) of all National Government’s share of annual revenue towards community projects identified at constituency level by the communities
Since 2003/04, the Fund supported projects mainly in the areas of education, health, agriculture, roads, security, environment and sports. However, the NG-CDF (Amendment) Act 2016 introduces a major shift in the scope of projects eligible for funding. Under this Act only projects falling within the functions of the National Government as outlined in the Constitution of Kenya will be funded (NG-CDF Official Website)
Countries within and outside Africa have also embraced the concept of CDF for example Ghana, India, Jamaica, Liberia, Malawi, Malaysia, Mongolia, Namibia, Nepal, Nigeria, Pakistan, Philippines, Rwanda, Southern Sudan, Tanzania, Uganda, Zambia, and Zimbabwe.
However in some countries the amount being allocated to the constituencies is gradually increasing, which is different from Kenya for a constant of 2.5% of the taxes is the amount that has been allocated to the NG-CDF every financial year. Zyl (2010) observed that CDFs grow very rapidly in size once they are introduced. For example, in the Philippines, CDF allocations have increased almost six fold since its introduction in 1990. In Zambia, the CDF per MP has increased from 60 million Kwacha in 2006, to 666 million Kwacha in 2010.
While there are several rules that govern the utilization of the Fund to ensure transparency and accountability, decisions over the utilization of the funds are primarily by the constituents. Unlike other development funds that filter from the central government through larger and more layers of administrative organs and bureaucracies, the funds under this program go directly to local levels. In essence, the CDF provides individuals at the grassroots the opportunity to make expenditure choices that maximize their welfare in line with their needs and preferences. To the extent that the local population is better informed about their priorities, the choices made can be expected to be more aligned to their problems and circumstances. The CDF can therefore be considered a decentralization scheme that provides communities with the opportunity to make spending decisions that maximize social welfare. The CDF is an example of what is generally referred to as Community Driven Development (CDD) initiatives that empower local communities by providing fungible funds (Kimenyi, 2005).
The impact CDF has on the citizens is almost inevitable this has been noted through the positive feedback from the media reports, the members of parliament and most importantly the citizens themselves, the major impact being the fund has been able to access the cities to the most interior parts of the country. At the start of the CDF the 2.5% amount set aside, three quarters of the amount was divided equitably between Kenya’s 210 constituencies whilst the remaining 1/4th is divided based on a poverty index to cater for poorer constituencies however this was later changed and the amount received is equally divided among the 290 constituencies, 5% of the amount is set aside to be used by the NG-CDF Board for administration, payment of salaries, monitoring and evaluation of the projects being undertaken in the constituencies and training and development of the NG-CDF staff.
The Vision 2030 development process was launched by H.E. Mwai Kibaki on October 30th 2006. The vision has three pillars the economic pillar, the social pillar and the political pillar. CDF has been able to successfully work towards achieving the social pillar among the constituencies for example in education, primary schools, secondary schools and the tertiary institutions have been built and rehabilitated through the fund. Healthcare has been achieved, the CDF funding has been able to successfully build and rehabilitate hospitals and dispensaries in the constituencies through this the Governments Big Four Agenda on the universal healthcare has also been fulfilled. After devolution, healthcare became a devolved function and thus cannot be funded through the CDF fund. Water and sanitation have also been achieved through the CDF funding through drilling of boreholes and construction of pit latrines. CDF has ensured poverty elimination in the country through the employment opportunities being created in the constituencies. The environment, through the planting of trees in schools and government institutions is also funded. Gender, youth and vulnerable groups are also involved in the CDF Committee, three women nominated by the ward development committees and one of whom is a youth, one person with disability nominated by the ward development committees (CDF Act, 2013)
In as much as the CDF has impacted the society positively, there have been several cases of corruption, misuse of funds, in some constituencies the funds cannot be accounted for and political interference in the allocation of funds.
However, there are two schools of thought over CDF. One holds that it is unconstitutional, illegal and should be scrapped. On the basis of this, one cannot interrogate the fund beyond its illegality. On the other extreme is the thinking, mainly by legislators themselves that every constituency should be allocated funds under this strategy to meet local development needs where the MPs are given the responsibility of constituting the Committees at the Constituency level at the commencement of every parliament. The limitation of this thinking is that all public funds must be subject to stringent accountability practices and controls, which opponents of this thinking feel is not happening with CDF. Pending holistic, effective constitutional reforms to clarify governance along either parliamentary or presidential system, CDF is here to stay in its present form (Kairu, 2009)