About CDF

 Background

The Constituencies Development Fund was created by the Constituencies Development Fund Act, 2003 with the primary objective of addressing poverty at grassroots level by dedicating a minimum of 2.5% of the Government ordinary revenue to grassroots development and the reduction of poverty. The fund is managed by the Constituencies Development Fund Board (CDFB)

In January 2013, the CDF Act 2003 (as amended in 2007) was repealed and replaced with CDF Act 2013 that is aligned to the constitution of Kenya 2010.

The enactment of the CDF Act 2013 was mainly aimed to ensure that the law governing CDF is aligned to the Constitution of Kenya 2010, specifically in compliance with the principles of:

ü transparency and accountability,

üseparation of powers; and

üparticipation of the people.

üThe new law was also aimed to align the operations of the Fund to the new devolved government structure.

 

Key Changes in the CDF Act 2013

qReduction in size of the CDF Board from seventeen to eleven members and introduction of a new officer, the Corporation Secretary as secretary to the Board.

qObviating the role of nominating Bodies in appointment of CDF Board members.

qSeparation of roles of the executive vis-à-vis  the Legislature.

qEmphasis on the mandatory role of Project Management Committees

q Submission of Project proposals to the Board by the Chairman of the CDFC.

qChange in size of CDFC resulting in reduction of the maximum number of committee members from sixteen (16) to eleven (11).

qChange in the mode of appointment of CDFC members.

qNew role of the Area Member of Parliament as ex-officio member rather than Chairman of CDFC.

qNames of the persons appointed as members of the CDFC to be published in Kenya Gazette.

qNew structure at County level, the County Projects Committee.

qFund Account Manager not DDO as AIE holder.

 

Summary of the new Institutional Structure of the Fund under CDF Act 2013

 

1.      National Assembly Select Committee on CDF

2.      The cabinet Secretary for the Ministry  responsible for CDF

3.      The Constituencies Development Fund Board (CDFB)

4.      The County Projects Committee

5.      The Constituency Development Fund Committee (CDFC)

6.      Project Management Committee (PMC)

 

Eligible projects under CDF Act 2013

      CDF Act Section 22 requires that “...Projects under this Act shall be Community based in order to ensure that the prospective benefits are available to a widespread cross section of the inhabitants of a particular area.”

       The Act further states that “...Any funding under this Act shall  be for a complete project or a defined phase   of a project and may include acquisition of land and buildings”.

       A Constituency Development Fund Committee Office including furniture is eligible project.

      Administration and Recurrent costs of CDFC up to a maximum of 6% of total annual constituency allocation.

      Administration and Recurrent costs of PMC up to 5% of total annual allocation to that specific project.

      Acquisition of Vehicles, machinery and equipment;

      Sports activities (minus cash awards) up to a maximum of 2% of total annual constituency allocation.

      Monitoring and Evaluation of on-going projects and Capacity Building  of various operatives up to a maximum of 3% of total annual constituency allocation.

 

Project Management

Projects will be managed and implemented by the Project Management Committees who will be expected to liaise with relevant government departmental heads for technical inputs. The CDFC will do project supervision , monitoring and Evaluation.

 

Allocation Criteria

         The Constituencies Development Fund comprises of an annual budgetary allocation equivalent to at least 2.5% of the Government ordinary revenue.

         A maximum of 5% is allocated to CDF Board for Administrative services.

         A minimum of 95% is allocated to constituencies based on the following formula;

a)     5% of the 95% is allocated to Emergency Reserve

b)    75% of the balance is allocated equally amongst all the 210 constituencies

c)     Balance of 25% is allocated based on the Constituency Poverty Index modeled by the Ministry of Devolution and Planning.

 

Around Ksh 137,670,000,000has been allocated to CDF since its inception. The onus of disbursing and ensuring constituencies’ use their share of the money efficiently and accountably falls with the CDF Board pursuant to CDF Act 2013.

 

FLOW OF FUNDS

         National Treasury releases funds to the CDF Board through the Ministry responsible for CDF in quarterly tranches

         CDF Board disburses funds to the Constituency Development Fund Committees (CDFC) on the basis of approved projects.

         CDFC disburse funds to the Project Management Committees (PMC) in appropriate phases through the Accountant responsible for CDF (Currently District/Sub County Accountant).

 

More than 85,000 CDF projects in various stages of completion have been established throughout the country. A significant percentage of these have already been completed and are in use

The impact of these projects is already being felt especially in the key sectors funded by CDF like Education (around 55% of CDF allocations), Health (6%) and Water (11%). To a large extent, these are projects that have been identified by the community on priority basis and are their completion and utilisation should therefore be satisfying genuine needs

The successes of the fund

         Education Sector: CDF funding of schools has assisted in increasing student enrolment.

       The CDF bursary has helped retain in schools        students from low income families.

         Through the roads sector, CDF has been able to open rural access roads (feeder roads) thus contributing to economic growth.

         CDF Health Sector has made it possible for the public to easily access health facilities.

         Focus on water projects has enhanced access to clean and reliable water.

         Establishment of police posts and  Local administration offices has enhanced security network throughout the country.

         Citizens not only exercise their democratic rights to self-governance but also participate in the process of debating and identifying priority projects to be funded.

         CDF has accelerated the government’s effort of creating employment away from urban centres by engaging local labour in projects. 

         Overall CDF is the major driver of government’s effort towards the  achievement of the Millennium Development .

 

CHALLENGES THAT NEED TO BE ADDRESSED

         Poor project implementation due to low capacity of the committees ( CDFCs and PMCs)

         Low community participation which leads to implementation of projects that are not aligned to their needs.

         Spreading of funds to too many projects – this is caused by lack of proper planning.

         Project planning without proper designs and drawings leading to low cost estimates which result into insufficient allocation of funds to projects.

         Projects implemented without proper Bills of Quantities leading to difficulties in monitoring and evaluation of projects.

         Weak supervision by the Government technical officers leading to poor quality of projects and mis-appropriation of funds.

         Inadequate record keeping by PMCs and CDFC.

         Inadequate audits by the various government agencies making it difficult to cub misuse of scarce resources.

         Implementation of projects without Board’s approval.

         Funding of new projects without considering on-going projects.

         Cases of issuance of completion certificates for poorly implemented projects.

         Failure by some CDFCs to honour contractual obligations leading to numerous complaints and court cases.

         Facilities built to completion through CDF funding but not taken over by the line ministries e.g. health centres.

         Inaccurate monitoring and evaluation of CDF projects by Civil Society organizations

         Negative publicity

         Entrenching CDF in the new constitutional dispensation.

 

HOW THE BOARD IS ADDRESSING EMERGING ISSUES

·        The Board partners with stakeholders such as United nations Development Programme (UNDP), Institute of Economic Affairs (IEA), Public Procurement Oversight Authority (PPOA), etc on periodic capacity-building of grassroots management structures.

·        Computerization of the CDF Board hopes to link the Secretariat office to the constituencies in an attempt to improve data processing and access to information by all stakeholders.

·        The CDF Board has formulated a Strategic Plan for 2010 – 2014 aimed at guiding its operations.

·        Regular engagement with the National Assembly Select Committee on CDF (NASC) to address emerging issues.

·        To improve the management of the Fund, the Board periodically issues policy guidelines and manuals.

·        Strengthening of audit systems and collaboration with investigating agencies i.e. Ethics and Anti-Corruption Commission (EACC) and Criminal Investigation Department of Police (CID) on cases touching on fraud.

·        The Board is engaging the Kenya National Audit Office (KENAO) on possibility of hiring private auditors  with a view to strengthen constituency audits.

·        To improve monitoring and evaluation, the Board has developed monitoring and evaluation guidelines and is continuously conducting training of all Fund Account Managers on Monitoring and Evaluation of projects. 

·        Public Education Campaigns: to create awareness and to enhance community participation in project identification and implementations.

·        Engaging with relevant Government ministries i.e. Ministry responsible for Public Works so as to improve supervision of CDF projects.

·        The Board has concluded Value for Money Audit/  Impact Assessment of CDF so as to assess and document the impact of the Fund.

 

Procedure for handling complaints

 

 Submit a written and signed complaint with all the relevant documentations attached

 The complaint is received and acknowledged within 2 days of receipt.

 The complaint is then  investigated to verify facts therein and internal auditors sent to the area incase of fraud.

 All complaints are analyzed and tabled before the Complaints and Arbitration Committee for deliberation and recommendations to the Board on the possible remedies

 Board decision is communicated to the complainant promptly; not later than 14 days from the date the Board passed resolution

 Incase the complainant is dissatisfied with the Board’s decision, he/she is allowed to appeal to the Minister in charge of CDF to appoint an arbitration panel to consider and determine the matter before the same is referred to court.


THE CDF BOARD

The Board of Directors of CDF are responsible for the governance of the organization. Good corporate governance is a fundamental part of the culture and the normal running of the organization.

 

Roles of CDF Board

Roles and function of CDF Board is provided by CDF (amendment) Act 2007 section 6 (1) are: 

                                                                                  

Project Management Roles

                     To consider project proposals submitted from various constituencies in accordance

 with the Act and send funds to the respective constituency fund accounts of the

approved projects

 

Financial Management and Accountability Roles

                     To ensure timely and efficient disbursement of the fund to every constituency

                     To ensure efficient management of the fund

                     To receive and discuss annual reports and returns from the constituencies

                     To ensure the compilation of proper records, returns and reports from the

 Constituencies

 

Monitoring and Evaluation Roles

                     Receive and address complains and disputes and take any appropriate action

                     To perform such other duties as the Minister, with the concurrence of the

Constituencies Fund Committee, may deem necessary from time to time for proper

 management of the Fund.

 

Composition of the Board

The Board requires that each of its directors possess unquestionable integrity and character. The following are the areas from which the directors are appointed;


·        PS planning or his or her designate representative

·        PS Finance or his designate representative

·        Clerk of the National Assembly or his designate alternate

·        Attorney General or his alternate

·        8 persons qualified in matters relating to Finance, Accounting, Engineering,    Community Development, or appointed by the Minister in accordance with subsection 5 of the CDF Act.

·        4 persons qualified in the above and appointed by the Minister to represent regional imbalance existing

·        Chief Executive Officer as an ex official

 

 

Summary of the new Institutional Structure of the Fund under CDF Act 2013

 

1.      National Assembly Select Committee on CDF

2.      The cabinet Secretary for the Ministry  responsible for CDF

3.      The Constituencies Development Fund Board (CDFB)

4.      The County Projects Committee

5.      The Constituency Development Fund Committee (CDFC)

6.      Project Management Committee (PMC)

 

 

PROJECT CYCLE

The Chairman in every constituency is required to convene a meeting in each location of the constituency to deliberate on residents’ development priorities.

These are then forwarded to the CDFC which in turn compiles and ranks them in a priority list of between five (5) and twenty five (25) project proposals in every financial year. 

The CDFC submits the project proposal to the Board for approval. The Board approves projects and disburses funds

Funding priority should be in completing on-going projects

 

CDF PROJECT CYCLE         

                                        

CONSTITUENCIES STATUTORY ALLOCATION CEILINGS

(As per CDF Act 2013)

 

ACTIVITY

 ANNUAL ALLOCATION

Emergency Reserve

5%

Bursary

25%

Office Administration/Recurrent expenditure

6%

Monitoring and Evaluation

3%

Sports Activities

2%

Environment Activities

2%

 

Role of Mwananchi in the Management of CDF

·        Provide opinion on specific development projects to be funded by CDF

·        Provide membership to the PMC and the CDFC

·        Provide grassroots and practical auditing of CDF projects

·        Monitor CDF projects

·        Ensure sustainability of CDF projects

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