Is Kenya’s Food Security a Mirage?

An analysis of Kenya’s 2018/2019 budget in relation to food security

Experts say the government has not allocated enough resources for the 2018/2019 of food security and nutrition. New report released yesterday on the 2018/2019 budget analysis stated that Kenya’s quest to become food secure will remain a mirage unless urgent and deliberate reformed are implemented. This is despite the agriculture sector receiving sh.1.45 billion more this financial year compared to the last budget.

In the budget, foods security and agriculture received a totals of sh. 18.8 billion which has been increased to sh.20.25billion i the 2018/2019 budget. While presenting the budget on June 14, National Treasury Cabinet Secretary Henry Rotich said the government is planning top grow enough food to feed its people at affordable prices.

“Achieving theis will require enhancing large-scale production by placing an additional 700,000 acres of land through public-private-partnership and by promoting investments in post-harvest handling. The government will also adopt contract farming and other commercial offtaking arrangements, including supporting the development o9f agro parks or hub to serve as a link to farmers and markets,” he noted.

Rotich allocated a total of ksh8.5 billion for ongoing irrigation projects in order to reduce the vulnerability to drought and bring additional land under crop production. The ongoing irrigation projects are in Bura and Mwea while the National expanded irrigation programme and smallholder irrigation programmme are I Galana Kulalu Turkana and micro irrigation in Schools.

The 2018/ 2019 budgetary allocation for fertilizer subsidy has been slashed by Ksh. 700 million. In the last 2017/ 2018 financial year, the government allocated Ksh. 5billion but this has been reduced to Ksh. 3 billion. “ On subsidized fertilizer, I expect the ministry of agriculture to reform the supply chain systems and ensure better service to farmers with the ongoing registration of farmers,” he emphasized.

Chief Administration Officer in the agriculture and irrigation ministry Andrew Tuimur confirmed that the ministry willnext commence the recruitment of enumerators to be engaged in the farmers registration exercise.

The budgetary allocation in some subsectors ha increased significantly. They include the irrigation sector, which has been allocated Ksh. 8.5 billion, which is Ksh. 1.2 billion more compared to Ksh. 7.3 billion for the last national budget. The strategic Food reserve has also received more this financial year at Ksh. 1.4 billion compared to Ksh. 1.3 billion in the lat budget.

The crop insurance sector which has been allocated Ksh. 700 million in the 2017/2018 financial year has now received Ksh. 300million. Mechanization of agriculture received Ksh.100 million and this has increased to Ksh. 500 million.

The national treasury allocated Ks. 300 million for the armyworm mitigation and Ksh. 1.9 billion for the Kenya Cereal enhancement. Rotich said Ksh. 460 billion has been allocated to the Big Four Sector drives and their enabling sectors.

“ To support specific incentives under the Special Economic Zones Act and other special incentives, the government will provide the enabling infrastructure including building industrial sheds. To this end, I have allocated ksh. 400 million for the leather industrial park Ksh. 23million development and 4000 million for textile development” said Rotich.

He also allocated Ksh. 1.4billion and Ksh. 200million to modernize facilities in RIVATEX and the new KCC respectively.

The government will further promote investments in postharvest handling as well a adopting contract farming and other commercial off-taking arrangements, including supporting the development of agro hubs to serve as a link to farmers and markets.

Rotich explained that during last year’s budget speech, he proposed to exempt VAT materials for the construction of grain storage facilities to support safe storage of food and ensure sustainable food security in the country.

“ In the budget, I proposed to expand this exemption to include equipment used in the construction of the facilities in order to lower the cost of post-harvest storage and this will go a long way in supporting the food security pillar under ‘The Big Four’ plan,” Rotich said.

While animal feeds are exempt from VAT the CS said some of the raw materials used in their manufucture are taxable and this treatment has led to high prices of animal feeds.

In order to make animal feeds affordable to farmers and attract more manufacturers to invest in the sector, the CS proposed to exempt the raw materials from VAT .

The CS also set aside Ksh.900 million for crop diversification adding that the se3vere drought experienced in the country0 last year underscores the importance of reducing reliance on rain fed agriculture.

Farmers in Uasin Gishu County have however complained that the government is yet to fulfill its pledge of releasing the Ksh. 1 billion owed to farmers for the sale of maize to the national Cereals and produce Board.

NOT ENOUGH
The report commissioned by the Route to Food Initiative, which comprehensively analyzed the 2018/2019 budget from a right to food perspective showed that allocations to the Food and Nutritional security was a paltry 3.54 percent of national government expenditures despite this sector being one of the pillars under the government’s Big 4 priority development agenda.

The route to food initiative is a programme working towards realizing the Right to Food in Kenya which is provided for in Article 43 of the constitution. In addition, the budget lacked explicit policies, programs and comprehensive fiscal incentives to address the constitutionally guaranteed Human Rights to Food.

“Treasury in its 2018 Budget Statement omitted food and nutrition sector from its assessment of key constraints to economic growth and development. Not only is this ironic as food security ha been prioritized in the Big 4, but it also undermines the need for policies and programs aimed at ending systemic hunger and laying the foundation for a meaningful and socially inclusive development path” Alexander Owino, a financial expert and author of the report said.

Additionally, the report faults the Budget statement for its various contradicting proposals which if implemented will disproportionately negatively affect small-scale farmers. Two proposals include the removal of interest rate caps and classification of fuel and oil a VAT exempt, which will in turn raise financing costs for the sector despite Government’s pledge to make affordable credit available.

Given that agriculture is a devolved function, the report advocates for allocation of up to 50 percent of the Ksh. 62.4 billion Conditional Cash Transfers to County Governments to be specifically spent on food and nutritional security programmes. “This measure alone would increase spending on Food and nutrition sector by an estimated Ksh. 30billion across all levels of government and over the medium tem begin to redress the current 3.54 percent allocation,” Owino noted.