CPA, Dr. Margaret Nyakang’o addressing participants during the Conference
The Controller of Budget Dr. Margaret Nyakang’o attended the third High-Level Policy Dialogue of the Málaga Global Coalition for Municipal Finance on October 5th-6th, 2023 in Málaga, Spain. The conference was jointly organized by the United Cities and Local Governments (UCLG), the Global Fund for Cities Development (FMDV) and co-hosted by the United Nations Capital Development Fund (UNCDF). It brought together diverse leaders in local government finance, including mayors, regional governors, government ministers, development banks, capital market authorities, and commercial banks to take stock of progress on the Coalition’s five-point policy agenda for transforming municipal finance.
The conference was aimed at exploring various ways of enhancing the growth of Own-Source Revenue (OSR).
The Controller of Budget’s presentation centered on Tax Administration Analytics and Local Revenue Improvement Actions. In her opening remarks, Dr Nyakang’o explained as of 30 September 2023, TADAT assessments had been carried out in 20 counties across Kenya and identified several gaps.
The counties namely; Busia, Garissa, Isiolo, Kilifi, Kisumu, Lamu, Makueni, Mombasa, Nairobi, Narok, Wajir, Kakamega, Kisii, Trans Nzoia, West Pokot, Kirinyaga, Meru, Tana River, Kericho and Nakuru were taken through a Strategy and Revenue Enhancement Action Plan Workshop (REAP) by the UNCDF. The Controller explained that out of this, REAPs were developed to address the counties’ own-source revenue impediments.
Dr. Nyakang’o further elaborated on how the Kenyan government, through the Intergovernmental Budget and Economic Council, fully adopted the TADAT program in a bid to enhance OSR generation.
“TADAT has helped counties improve their revenue collection capacity by giving recommendations for streamlining and strengthening tax operations, resulting in enhanced revenue generation for the counties,” the Controller said.
She highlighted several issues on TADAT among them being, nine performance outcome areas that help identify weaknesses and gaps in tax administration systems and processes. In her presentation, Dr Nyakang’o explained how this tool exposes shortcomings in tax compliance mechanisms, inefficiencies, and areas where tax administration processes can be streamlined as well as capacity-building needs.
“TADAT enhances the credibility and transparency of the tax administration systems,” Nyakango affirmed. She proceeded to explain how the tool has allowed County governments to understand specific areas requiring improvement and take appropriate actions.
“The Controller of Budget’s County Government Budget Implementation Review Reports (BIRR) FY 2021/2022 and FY 2022/2023, show that 11 Counties that underwent TADAT assessments more than one year ago had their Own Source Revenue grow by over 10%”, Dr Nyakang’o reported.
The Controller of Budget also spoke on the formulation of REAPs which considered the achievements, limitations, and lessons learned since the inception of devolution. She was optimistic these plans would address the challenges in design, compliance, and accounting in revenue administration.
“The REAPs will cover interventions on weaknesses in revenue administration in the nine performance outcome areas as provided in the TADAT framework”, she emphasized.
In conclusion, Dr. Nyakang’o advised participants to embrace a culture of creating Standard Operating Procedures to guide systems and processes; implement succession planning for Human Resource function gaps; adopt a computerized revenue management system for efficient revenue administration, and maintain continuous capacity-building initiatives to address skill gaps in the revenue management department.
(Front 2nd Right) Dr Margaret Nyakang’o poses with other leaders at the Conference