The Accountant Sep-Oct 2016√(2)

GOVERNANCE
management. I have used two of those
definitions (EC & UNDP) to capture
what capacity building in the public sector
should aim for:
European Commission: “To develop
and strengthen structures, institutions
and procedures that help to ensure:
transparent and accountable governance
in all public institutions; improve
capacity to analyse, plan, formulate
and implement policies in economic,
social, environmental, research, science
and technology fields; and in critical areas
such as international negotiation.”
United Nations Development
Programme: Capacity is the “process
by which individuals, organisations, and
societies develop abilities to perform
functions, solve problems, and set and
achieve goals premised on ownership,
choice, and self- esteem. “ Capacity
building is the “sustainable creation,
retention, and utilization of capacity in
order to reduce poverty, enhance selfreliance,
and improve people’s lives.”
From the above, capacity building efforts
should target institutions, structures,
procedures, organizations and society
to develop abilities to manage public
resources in a transparent and accountable
manner. There is mention of abilities
to solve problems and achieve goals
with the end result of reducing poverty,
improve citizen’s lives as well as enhance
self-reliance. One may therefore want
to audit the PFM reforms that various
African countries have been engaged in
over the years; to determine whether these
have built capacity to be self- reliant, and
whether they have led to improvements of
the lives of ordinary citizens.
Capacity building dimensions
Public finance management capacity
building efforts should be undertaken
at the following levels: institutional,
organisational, individual.
Institutional capacity building
Institutional level capacity building involves
enabling environment (political leadership,
public buy- in). Top political leadership
have to provide the required leadership
for capacity building to succeed. The
support in pronouncements, sensitivity
when making cabinet appointments,
leading action that is necessary to send
powerful messages regarding compliance
with public financial management
regulations are all important in creating
an environment to change ways of
working. Appointments and recruitments
to the finance ministry (which is the
owner of Public Financial Management
efforts) should not be based on political
considerations alone but should carefully
consider the PFM reforms agenda. It
can be frustrating for public service
accountants if they see little or no progress
with the reforms being implemented. The
Top political
leadership
have to
provide the
required
leadership
for capacity
building to
succeed.
end result may be resigning themselves to
mechanistic compliance with the reform
agenda, without a profound need to
make real changes. Others may abandon
the reforms altogether and even start
sabotaging them. Management practice
theory tells us that subordinates will
adopt the organisational culture they see
in place. If they see that from the highest
office in the land to their leaders, there is
a consistent message of upholding good
public finance management practices,
they are more likely to embrace those
efforts. This also means that leaders
should support policies that take trainings
seriously (formal and informal). This sends
the message that training courses that
do not have demonstrable value to the
trainee’s role should not be approved.
Legislative framework
Public finance capacity building is a long
term activity and resource consuming. It
is important that it is properly anchored
in law to ensure enforceability. Chapter
12 of the Constitution of Kenya, 2010
covers public finance matters ranging
from revenue raising and sharing, budget
management, control of finances and
oversight. The PFM Act 2012 goes
further to detail regulations regarding
management and use of public finances.
This can be regarded as the financial
policies and procedures manual for
government public finance management
and has to be adhered to both at the
National and County levels. The preamble
of this Act states that it is AN ACT of
Parliament to provide for the effective
management of public finances by the
national and county governments; the
oversight responsibility of Parliament
and county assemblies; the different
responsibilities of government entities
and other bodies, and for connected
purposes.
Obviously the Act cannot cover all the
details of daily operations in the public
sector and needs to be supplemented by
detailed policies and procedures manuals
specific to the different activities
undertaken by MDAs (Ministries,
Departments and Agencies) as well as
County governments. This is important
because civil servants need to be guided
on expected practice as they make
decisions about financial transactions on
a daily basis . It also forms a basis for
training them on what is expected of their
roles.
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