Intergovernmental fiscal relations in Kenya: A Case study of Nairobi City Council
Abstract
The alm of this study is to identify the maJor
responsibilities of local authorities in Kenya, and
compare these expenditure responsibilities to sources
of revenue. An attempt has been made to analyse the
determinants of the observed weak financial position
of local authorities in Kenya, particularly of the
Nairobi City Council.
It has been found that the relatively high personal
income level of Nairobi residents does not prevent severe
~financial hardship for the Nairobi City Council. The gap
between resources and expenditure requirements, is, in the
case of Nairobi City Council, deepened as a result of various
Central Government decisions: the abolition of the Graduated
Personal Tax and consequent loss of revenue; the abolition
of primary school fees; the introduction of some free
medical services; and the subsequent expanded expenditure
on education and health for which the Central Government
has not made adequate grants to the NCC. The position
was compounded by several centrally determined salary
rate increases for teachers and other Nairobi City Council
employees.
Various policy suggestions are made as to ways
of meeting the growing budget and service level deficits
while rationing the local government financing system.
Citation
A Research Paper submitted to the Department of Economics, University of Nairobi, in partial fulfilment of the requirements for the Degree cf Master of Arts in Economics.Publisher
Arts-economics