Subsidies are often misconstrued to mean reduced costs. But the truth is that subsidies increase the cost of items in the end through long bureaucratic processes needed to administer them.
Subsidies, therefore, do not lower the cost of goods since the reduced prices are paid through government coffers, taxes, or by foregoing services that could have been in the first place paid for by resources used in the subsidy program.
Let’s take a step back and start from where we should have. Kenya is currently experiencing the worst drought-related food crisis.
As at August 2022, Kenya had experienced four consecutive failed rain seasons and the weather forecast showed a likelihood of a fifth failed season by the end of 2022 resulting in 4.1 million Kenyans experiencing severe food insecurity.
As livestock die and crop production shrinks, families are struggling to access sufficient food. Lack of milk for children and lactating women is having a significant impact on nutrition. While drought-related food insecurity cases are evident, chronic food insecurity affecting urban dwellers as well as rural areas remains a “silent killer.”
Urban food insecurity has increased since the Covid-19 pandemic and made even worse with the current global food and economic crisis including the war in Ukraine. High levels of unemployment especially in urban informal settlements are a major contributing factor to the inability of many urban dwellers to afford to feed themselves.
Coping mechanisms in these areas include sacrificing food quality, and safety for just any food, skipping meals, and taking credit from microfinance institutions (mainly mobile moneylenders), which is an approach that further complicates the food insecurity problem.
The World Bank’s Kenya Economic Outlook report, 2022 showed that the proportion of Kenyan households unable to access stable food increased by 36 percent with a sharp increase experienced in the rural areas at 38 percent and 33 percent in urban areas since November 2021.
The whole country’s proportion shot up to 50 percent as food prices increased to 12.4 percent in May 2022 up from 9 percent in March 2022. Basic food items like maize flour prices increased from Sh120 to 220 per 2kg packet in just 4 months.
Healthy, diverse diets remain a far-fetched reality for most households, as many are unable to meet the cost of fresh fruits, vegetables, and protein-rich food items.
This is bigger than 1.4 million bags of subsidized fertilizer. A bigger systemic problem that needs urgent yet forward-looking, sustainable solutions to address. The fertilizer subsidy program has in the recent past been misused.
The program is notorious for being selective on who gets to benefit, which farmers qualify, and runway corruption scandals that have not yet been resolved. Traders have also managed to hijack the fertilizer and sell it expensively to unsuspecting farmers.
While it is true that production-based subsidies are better than consumption subsidies, our food and farming systems should be completely free from reliance on government “resuscitation.”
The Right to Food, enshrined in the Kenyan Constitution does not mean that Kenyans should be fed, whether through Unga or fertilizer subsidies. It espouses the aspiration of every Kenyan, in the community or alone, to feed themselves with dignity. This is what we should demand from the current government.
There is a need to enact legal mechanisms that clearly outline measures the government can take in their role to recognize, protect and fulfil the Right to Adequate Food for all.
It will also provide mechanisms to deal with violations from third-party actors who take advantage of Kenyans either by engineering or taking advantage of crises to make abnormal profits.
Let us face it, subsidies are expensive and just don’t work. The Unga subsidy announced in July only ran for a month and cost Kenyans Sh7.2 billion. The fertiliser subsidy program announced by President William Ruto will cost Kenyans a further Sh18.4 billion.
As a country, we need to move beyond subsidies and address the underlying challenges facing Kenya’s agriculture sector as a whole.
Key issues to be addressed include lack of information on sustainable farming practices that not only have the potential to enhance productivity but also significantly reduce the dependence on external, expensive and unsustainable chemical inputs.
Revival of public extension is an urgent need to meet producers at their different points of need and ensure that food production is enhanced, and agroecosystems rebuilt.
Kenyan farmers have come up with innovative ways of managing their farms and enterprises and ensuring good harvests for their families and market without depending on external inputs.
Practices such as mixed farming, intercropping, and making farm compost can go a long way in supporting production with no added cost.
This requires knowledge and support for farmer-led innovation and research to transform our agriculture sector to one that is resilient to climate and market shocks, protects the integrity of our environment and feed us sustainably.
Subsidizing inputs without proper analysis of the current and emerging challenges that farmers face will not cure the problem. President Ruto and his team should live up to their “bottom-up” slogan and develop policies and interventions that start from producers and not the other way around.
While painkillers are easy to administer, they do not require much expertise and precision, our agriculture sector needs cleaning, surgery, and proper dressing to heal.
Published at Business Daily Africa