Analysis of Public Expenditure in Support of Food and Agriculture in Kenya, 2006-2012

Abstract

Kenya has not met the 10 percent target of the total government spending as agreed upon at the African Union meeting in Maputo in 2003. The level of expenditures falls below the target 10% of total government spending. This means that a low share of the country’s budget was devoted to food and agriculture over the 2006-2012 period under review. This corresponds to a decrease of the agriculture value added growth as well as the Gross Domestic Product (GDP), which plunged twice in 2008 and 2011. The composition of public expenditures in support of food and agriculture has been unequally balanced, with 60 percent allocated to agriculture-specific expenditures as opposed to 40 percent for agriculture-supportive spending (rural education, health and infrastructure). Within agriculture-specific expenditures, general sector support has been predominant over direct payments to agents, at 80 percent. The main categories supported were extension services at 25 percent, research at 16 percent, input subsidies at 14 percent and infrastructure and veterinary services at 10 percent. The level of payment to producers was high in 2009/2010 compared to all the other periods but it dropped to 3.9 percent in 2010/2011 period. On the other hand, payment to consumers is only reflected in the school feeding programmes which accounts for approximately 99 percent of the payments. The targeted support to individual commodities has mainly flowed to one commodity; maize, because of the fertilizer reduction initiative which largely focuses on the crop. This therefore does not reflect an effort to promote development of the agricultural sector as whole. External resources constitute a fairly large proportion of development funds for the Ministry of Agriculture at an average of 65 percent for the whole period of analysis. However, a detailed analysis on the donor versus government allocations to the sector was not carried out.