Lead image for Stop measuring development in concrete.
This is a sequel to yesterday’s Saturday Nation argument on the Senate’s emerging use of Parliamentary Budget Office (PBO) criteria to rank counties. There is a serious intellectual problem with defining “development” as what can be photographed, depreciated and entered in an asset register, while treating investment in people as recurrent consumption. The PBO performs an important oversight role, but its framework risks teaching counties the wrong lesson: build more concrete, spend less on people, and rank better.
That would be an unfortunate triumph of accounting over economics. Kenya’s budgeting system is programme-based, linking resources to policy objectives, programmes, outputs and outcomes — not merely objects purchased. Yet counties must allocate at least 30 per cent of their budgets to development expenditure. The problem begins when “development” becomes synonymous with physical assets.
A road is an asset, but it wears out. A hospital needs maintenance. A vehicle depreciates. Even a new school begins ageing when children enter it. Education behaves differently. A child who learns to read does not become less literate with time. A nurse can become more valuable with experience. A teacher who masters mathematics can teach successive generations. Engineers, doctors, entrepreneurs and artisans accumulate knowledge, judgement and networks. Human capital compounds. There is an economic irony here: almost everything government calls “capital” depreciates, while its most important capital can appreciate.
A newly recruited doctor cannot economically be equated with one who has 20 years’ experience. The latter has accumulated knowledge and institutional memory. Treating the first doctor’s training as recurrent while celebrating the hospital in which both work is like celebrating the chicken coop while forgetting the chicken.
The same logic applies to medicines. Drugs are recurrent because they are consumed. But their social return survives consumption. A treated child returns to school; a mother saved in childbirth returns to her family and economic activity; a worker cured of disease returns to work. The medicine disappears. Its economic benefit does not.
There is another practical problem: counties do not start from the same point, and some may already have reached sensible limits on investment in concrete.
Consider parts of Central Kenya, where fertility has fallen sharply, in some places to around two children per woman from roughly four a generation ago. The consequence is visible: declining enrolment and the closure or consolidation of some primary schools.