Poverty Statistics versus CDF: Which Way for Kenya ?
Published on 13th October 2008
The recent debate about the poverty statistics released by Kenya’s Ministry of Planning vis-à-vis allocation of community development fund (CDF) is an issue about targeting of the prized funds.
Established in 2003 through the CDF Act in The Kenya Gazette Supplement No. 107, the fund is expected to support constituency-level, grass-root development projects. The aim of CDF is to achieve equitable distribution of development resources across regions, a thorny issue that often threatens to stretch the Kenyan socio-ethnic fabric to its limits.
An acceptable formula for targeting CDF will assure fairness in distribution and contribute greatly to intended benefits. It is impossible to divest the issue of targeting from any discussion involving distribution of assistance. Assistance can be distributed in a ‘blanket’ manner, with 0 percent targeting or can be very sharply focused with close to 100 percent targeting. Currently, 75 percent of CDF is allocated equally amongst all 210 constituencies in a ‘blanket’ manner, while the remaining 25 percent is targeted according constituency poverty levels.
A bone of contention has arisen as a result of a proposal to further reduce the ‘blanketed’ portion and to increase the ‘targeted’ portion using poverty statistics. As a result, any attempt to include a constituency among the list of the less poor is being likened to pronouncement of a curse upon the constituency.
While targeting of many assistance programs falls anywhere along the targeting continuum, the optimal level is dictated by policy goals, the form of assistance and the type of need. For needs often associated with some level of stigma, like famine relief, it is possible to achieve 100 percent targeting through self targeting. In such cases, only the most needy will come forward for the assistance since what is offered (e.g., yellow maize) is often not the preferred gift and the fact that most people are ashamed of being associated with the need. Other examples can be cited where due to the nature of the need and type of gift, the targeting formula is fairly straightforward.
However, with free government cash like CDF, targeting gets compounded by the notion of entitlement. If politics of the day are allowed to cloud the CDF objectives, proponents of ‘blanket’ distribution can easily carry the day. Fortunately, given resource constraints, it is not difficult to demonstrate the advantages of increased targeting, the need to do more with less.
While targeting of many assistance programs falls anywhere along the targeting continuum, the optimal level is dictated by policy goals, the form of assistance and the type of need. For needs often associated with some level of stigma, like famine relief, it is possible to achieve 100 percent targeting through self targeting. In such cases, only the most needy will come forward for the assistance since what is offered (e.g., yellow maize) is often not the preferred gift and the fact that most people are ashamed of being associated with the need. Other examples can be cited where due to the nature of the need and type of gift, the targeting formula is fairly straightforward.
However, with free government cash like CDF, targeting gets compounded by the notion of entitlement. If politics of the day are allowed to cloud the CDF objectives, proponents of ‘blanket’ distribution can easily carry the day. Fortunately, given resource constraints, it is not difficult to demonstrate the advantages of increased targeting, the need to do more with less.
The desire for improved targeting of CDF should therefore not just be for the Planning Minister or the CDF Committee; it should be an ideal for the committees at the constituency level and indeed for every stakeholder. We should all support a sharp focus in targeting the funds to those with the greatest needs and with the least capacity to meet the needs.
Assuming that nobody is against improved targeting, the current debate on the poverty list vis-à-vis CDF should therefore be on a better targeting formula. A good targeting formula must achieve balance between cost-effectiveness and accuracy as well as enjoy widespread acceptance by a cross section of stakeholders.
Increased targeting has its pros and cons. Proponents of sharper targeting tend to be more results-oriented, and see it as a vehicle to deliver efficiency with scarce resources, to produce the “biggest bang for the buck”. Targeting allows a systematically focused support on those regions or communities with the greatest need. The benefits of targeting arise precisely because it reduces the size of the target population, thereby increasing per capita allocation and hopefully leading to accelerated development.
However, caution is crucial since if targeting is stretched too far, its associated costs can increase with its narrowness or intended accuracy. These costs may exceed the benefits achieved from targeting. The most common cost of narrower targeting is the unintentional exclusion of the neediest brought about by inaccuracies of the targeting formula. Other real costs are those associated with procurement of technical expertise for research, development and personnel training.
The Planning Ministry should be commended for its desire to improve targeting and taking the cue from the public about the inaccuracy of the poverty formula presented recently towards this effort. This indeed is a healthy starting point in charting the path towards a 100 percent targeting ideal. The Ministry must be encouraged to perfect what should be seen as a patriotic effort. No wonder the Ministry has been awarded first position twice now, for ‘showcasing’ and also for ‘automation in service delivery’, under the Public Administration category during the Public Service Week.
Murage G. Mugo (PhD)
Assuming that nobody is against improved targeting, the current debate on the poverty list vis-à-vis CDF should therefore be on a better targeting formula. A good targeting formula must achieve balance between cost-effectiveness and accuracy as well as enjoy widespread acceptance by a cross section of stakeholders.
Increased targeting has its pros and cons. Proponents of sharper targeting tend to be more results-oriented, and see it as a vehicle to deliver efficiency with scarce resources, to produce the “biggest bang for the buck”. Targeting allows a systematically focused support on those regions or communities with the greatest need. The benefits of targeting arise precisely because it reduces the size of the target population, thereby increasing per capita allocation and hopefully leading to accelerated development.
However, caution is crucial since if targeting is stretched too far, its associated costs can increase with its narrowness or intended accuracy. These costs may exceed the benefits achieved from targeting. The most common cost of narrower targeting is the unintentional exclusion of the neediest brought about by inaccuracies of the targeting formula. Other real costs are those associated with procurement of technical expertise for research, development and personnel training.
The Planning Ministry should be commended for its desire to improve targeting and taking the cue from the public about the inaccuracy of the poverty formula presented recently towards this effort. This indeed is a healthy starting point in charting the path towards a 100 percent targeting ideal. The Ministry must be encouraged to perfect what should be seen as a patriotic effort. No wonder the Ministry has been awarded first position twice now, for ‘showcasing’ and also for ‘automation in service delivery’, under the Public Administration category during the Public Service Week.
Murage G. Mugo (PhD)
Managing Partner, Scenario Africa Ltd.