Public Account and Coding System in Kenya : The Trend and Pattern of Agricultural Expenditure

This paper is part of a set of country case studies that take a detailed look at public expenditures in agriculture and at how these expenditure data are captured in government financial and budget accounts. The objective of these studies is to unpack the black box of public expenditure statistics reported in various cross-country datasets and ultimately enable the use of existing government accounts to identify levels and compositions of country-level agricultural spending data, with clearer knowledge of what these data are in fact accounting for.Public expenditure is one of the most important policy instruments to achieve the development goals in developing and transition countries, and the formulation of an effective policy relies on a clear definition of agricultural expenditure. Based on government expenditure data from 2002/2003 to 2010/2011, this paper first reviews the institutional arrangement and budgeting process in Kenya, followed by a description of the structure of public expenditure account in Kenya. The expenditure data are aggregated according to clearly delineated administrative, functional, and economic classifications, which produces the composition and trend of agricultural expenditure in the country over time. Results from aggregation suggest that agricultural expenditure goes beyond the ministry of agriculture and that the share of agriculture in total expenditure remained stagnant at 4-5 percent in the 2000s despite a steady increase in the level of total government spending. More investment in agricultural capital is needed to promote long-term growth in agricultural production and productivity