Factors influencing Local Authority Transfer Fund Project implementation: a case of Municipality of Meru, Meru County, Kenya

Abstract

Introduction of Local Authority Transfer Fund (LATF) as an aspect of fiscal decentralization in the year 1999 was a noble idea. However, analysis of data on the LATF program in Kenya indicate that it has not met its objectives of improving local service delivery; improved financial management and accountability and reduction of outstanding debts. By 2002/03, the Local authority outstanding debts were estimated atKsh.9 billion.

The provisions of services at the local levels have not improved as captured by the low levels of expenditure on capital, estimated on average at 18% for the three years. The actual revenues realization and expenditures of Local authorities are not reflective of the budget estimates an indicator of poor financial management and accountability in Local authorities. Overall, the regulations on which LATF is being administered are flawed.

From the report and studies reviewed the performance of LATF programme has been constrained by a number of factors. These include amongst others inadequate capacity to allocate and account for funds; poor enforcement of LATF regulations; low revenue realization; lack of coherent monitoring and evaluation system and politicization of the funds. It is on this basis that the study examined factors specifically influencing project implementation financed through LATF. The study was based on four main objectives focusing on the factors that influence implementation of LATF projects. These are the amount ofLATF allocated; the management of funds; the stakeholders' participation and the staffing levels of Local authorities.

The study focused on the wards within the Municipality. For the purposes of data collection questionnaires were used. The study used descriptive design. The research instruments were pre- tested to ensure validity and reliability. Data was analyzed objectively using both descriptive and inferential statistics. Frequency tables and percentages were used for data presentation. The study that the amount of LATF funds received greatly influenced both the number and size of project implemented. The management of the funds as well as the participation of project committee members played key role in influencing project implementation.

The study further established that staffing levels of the local Authority were adequate and possessed appropriate skills necessary for project implementation. Howeverthe study recommended the need to equip project members with appropriate skills. The study further recommended a sound criterion be developed to allocate LATF funds based on the need of respective wards. It is hoped that the outputs ﾷof this study will benefit the policy makers involved in LATF project implementation to come up with appropriate guidelines that will facilitate implementation of projects.