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Public Debt and Uganda’s Economic Growth
(Kenyatta University, 2025-11) Chebet, Victoria
Uganda, like many developing economies, has increasingly relied on borrowing to finance budget deficits and public investments. This growing dependence on debt has raised serious concerns about the country’s long-term economic growth and debt sustainability. Existing empirical evidence for Uganda and the wider region is mixed, and often does not distinguish clearly between the roles of external and domestic public debt or between short-run and long-run effects. This study explored the correlation between public debt and economic growth in Uganda, aiming to influence the causal impact of public debt (external and domestic debt) on economic growth and assess its impact. A comprehensive evaluation of theories regarding the correlation between public debt and economic growth was carried out, focusing on both positive and negative impacts. An Autoregressive Distributed Lag bounds testing approach was since variables used were integrated of order zero and one. The model was utilized to examine the evolving connection using time series data (1993–2023). The analysis shows that although external debt and domestic debt form part of a long-term equilibrium relationship with GDP per capita as indicated by the ARDL bounds test (F = 6.313 above all upper critical values), neither variable demonstrates predictive causality toward economic growth when tested individually. In the short run, external debt exerts a positive and statistically meaningful effect on economic growth (β = 0.1268, t = 2.91, p = 0.010), while inflation has a weak negative influence (β = –0.1604, t = –1.99, p = 0.063). Gross domestic savings also reduce gross domestic product per capita in the short run (β = –0.2291, t = –2.20, p = 0.042), whereas trade openness positively contributes to growth (β = 0.2402, t = 2.32, p = 0.033). Other variables including domestic debt, capital formation, human capital development, and foreign direct investment do not exhibit statistically significant short-run effects. In the long run, neither external public debt (β = –0.0289, t = –0.91, p = 0.377) nor domestic public debt (β = 1.0727, t = 1.59, p = 0.130) exhibits a statistically significant effect on real gross domestic product per capita. By contrast, gross domestic savings show a weak but negative association with economic growth (β = –0.2373, t = –2.00, p = 0.062), while trade openness exerts a positive and statistically significant long-run effect (β = 0.2488, t = 2.20, p = 0.042). However, most control variables are individually insignificant. Based on the findings, the study concludes that external debt supports economic activity only in the short run, while neither external nor domestic debt has a meaningful long-run effect on Uganda’s economic growth. Long-run performance is instead shaped more by structural factors such as domestic savings which exert a negative influence and trade openness, which consistently promotes higher gross domestic product per capita. Based on these findings, the study recommends that government priorities productive external borrowing, strengthen policies that deepen export competitiveness, and reform domestic savings mobilization to ensure savings are channeled toward investment rather than consumption. Strengthening debt management and enhancing the efficiency of public investment will also be essential for sustaining long-term economic development
Enforcement of Ethical Standards among Employees and Public Service Delivery at Bomet County Government, Kenya
(Kenyatta University, 2025-11) Chepkoech, Helen
The enforcement of ethical standards within public service delivery is a critical issue that significantly influences the effectiveness and efficiency of government operations. In recent years, ethical lapses such as corruption, mismanagement, and lack of accountability have raised public concern regarding the quality of services offered by county governments. These unethical practices not only erode public trust but also impede the development and well-being of communities. This study sought to examine the effect of enforcement of ethical standards among employees on public service delivery in Bomet County Government, Kenya. The specific objectives were to: examine the effect of compliance with laws among employees on public service delivery; assess the effect of regular monitoring among employees on public service delivery; and determine the effect of implementation of ethics training programs among employees on public service delivery in Bomet County. The study was guided by the Institutional Theory and Agency Theory. A descriptive research design was adopted, targeting a population of 165 employees working at the Bomet County Headquarters, comprising 15 heads of departments, 25 directors, and 125 frontline service providers. The sample size of 120 respondents was determined using the Yamane (1967) formula, and participants were selected through stratified random sampling to ensure proportional representation across departments. Data were collected using semi-structured questionnaires. A pilot study involving 12 respondents (approximately 10% of the sample size) was conducted to test the research instrument. Content validity was ensured through expert review by two university research supervisors and one ethics specialist, while construct validity was checked through alignment of questionnaire items with study objectives. The reliability of the instrument was evaluated using Cronbach’s Alpha, with a reliability coefficient threshold of 0.7 set as acceptable for internal consistency. Both quantitative and qualitative data were collected. Quantitative data were analyzed using descriptive statistics (means, percentages, and standard deviations) and inferential statistics (ANOVA and multiple regression analysis), while qualitative data were analyzed thematically and presented narratively. The findings revealed that compliance with laws, regular monitoring, and implementation of ethics training programs among employees had a positive and statistically significant effect on public service delivery, with p-values of 0.002, 0.002, and 0.004, respectively. The study concluded that compliance with laws promotes transparency and accountability among employees, regular monitoring enhances adherence to standards and timely correction of deviations, while implementation of ethics training fosters professionalism and ethical behavior. It was recommended that the county government strengthen and harmonize ethical frameworks, institutionalize continuous ethics training, and establish an independent ethical oversight unit to ensure consistent adherence to integrity and public service values
Fiscal Policy Regimes Impact on Public Debt in Kenya
(Kenyatta University, 2025-11) Kirimi, Sarah Gacheri
The fiscal policy regime in Kenya is thought to be unsustainable as the rise in debt levels is linked to a worsening fiscal balance. The unprecedented accumulation of debt shows that debt stabilization is not a major concern for the government. Thus, the study tried to relate the ways in which fiscal policy regimes impact public debt in Kenya. The particular objectives were to establish the fiscal regimes that favor sustainable debt in Kenya and how long fiscal policy regimes last. The study was conducted using the yearly time series data from 1990 to 2023. Data that was utilized for the research was obtained from Kenya's Economic Surveys and the World Bank. The economic surveys were the data source for domestic debt and fiscal deficit, while World Bank data provided information on the interest rate and inflation. The primary objective of the study was accomplished by using transition probabilities and intercepts to identify fiscal policy regimes. The study used structural breaks to account for regime changes. The Markov switching model was used as a way to set up the fiscal regimes endogenously. The debt coefficient in the Markov Switching model was used to determine whether the fiscal regime was active or passive, i.e., a significant and negative debt coefficient, the regime was termed passive, and vice versa. The study confirmed the presence of two fiscal policy regimes between 1990 and 2003. The passive regime labeled “state 1” was confirmed by a constant of -0.20702(p-value = 0.009), which showed a significant negative intercept, suggesting that public debt was low in this state, while in state 2, the active regime, the constant of -0.05517 (p-value = 0.479) showed an insignificant negative intercept, suggesting high debt levels. The presence of two regimes (passive and active) confirmed that Kenya’s fiscal policy has been changing over time and that passive fiscal regimes favored debt stabilization compared to active regimes. The study established the duration of fiscal policy regimes through the transition probabilities and computation of expected duration, which revealed that the active regime was more persistent and lasted for approximately 6 years, while the passive regime lasted for approximately 4 years. Structural breaks were also identified in 1993,1995, 2002, and 2010, indicating efforts of debt stabilization and transition to a passive regime. The absence of structural breaks from around 2012 indicated a strong shift away from the passive regime to the active fiscal regime. The regression findings revealed that real interest, exchange rate, and fiscal balance were statistically significant and had affected debt levels in both regimes. The study confirmed that Kenya’s debt is highly sensitive to policy choices rather than historical debt levels, since lagged debt was statistically insignificant, emphasizing the need for proactive fiscal management in stabilization. Therefore, for sustainable debt management, policymakers should strengthen the institutional rules, such as fiscal deficit caps, debt brakes/ debt ceilings, and policy frameworks that support the conditions observed in a passive regime. Policy makers should also avoid prolonged active regimes, as they lead to debt accumulation and unsustainability
Revenue Management Procedures and Locally Generated Revenue in Mandera County, Kenya
(Kenyatta University, 2025-11) Salat, Hassan Abdinasir
County governments take the core position in fiscal decentralization implementation, service delivery, and local economic development. They are given the mandate to raise locally generated revenue (LGR) in the effort to finance devolved functions, complement national transfers, and increase financial autonomy. The devolved government is therefore very dependent on the performance of revenue management systems, which inform counties' ability to finance operations, provide public goods, and provide fiscal accountability. Mandera is one of the counties in Kenya that have continued to underperform in revenue collection and the chronic deficits have been undermining service delivery and fiscal sustainability. The research analyzed the effect of revenue management activities on LGR in Mandera County through a revenue identification, revenue assessment, revenue billing, and revenue collection activities review. The research covered the period 2019-2024 and was guided by Public Finance Theory, Benefit Theory of Taxation, Institutional Theory, and Human Capital Theory. The research design was descriptive, and the study population was 153 officers who worked in county revenue administration, which included county, sub-county, and ward revenue officers, assessment officers, collectors, and clerks. Primary and secondary data were employed, where primary data were gathered using structured questionnaires and secondary data were gathered from the budget implementation review reports and the audited financial statements. Pilot study was employed to attempt the validity and reliability of research measures using Cronbach's Alpha Coefficient to test for internal consistency, and content and criterion validity. Normality Test, Multicollinearity Test, Heteroscedasticity Test, and Autocorrelation Test were performed to add strength to the regression model. Data was analyzed using SPSS with descriptive statistics and inferential statistics. Under the descriptive statistics, means, frequencies, and standard deviations were applied, whereas under the inferential analysis, multiple regression and Pearson's correlation were applied. Regression analysis revealed that revenue identification processes (p < 0.05), revenue assessment processes (p < 0.05), and revenue collection processes (p < 0.05) made positive contributions to LGR at a statistically significant level, hence implying that systematic identification of sources of revenue, transparent assessment, and efficient collection mechanisms improve revenue performance. Conversely, revenue billing operations negatively but strongly affected (p < 0.05), which signposts that billing system inefficiencies are detrimental to compliance and decreased collections. Effective identification, assessment, and collections processes are found to be essential to maximize county revenue performance, whereas billing failures put fiscal performance on a plateau. Countries should also embrace dynamic and forecast identification technologies, utilize context-sensitive and progressive assessment systems, reshape billing systems with behaviorally and incentive-based structures, and enhance collection systems through real-time transparency dashboards and mobile money tax wallets. The regulators, Commission on Revenue Allocation, and Office of the Controller of Budget are also encouraged to increase oversight and support the counties in installing state-of-the-art and transparent revenue management systems. All ethical issues, including research permission, privacy, and the informed consent of respondents, were observed in the research.
Integrated Financial Management Information System and Fund Management in Homa Bay County in Kenya
(Kenyatta University, 2025-11) Malombo, Harvey Trevor
Fund management of Homa Bay County is currently facing challenges as auditor general reports are suggesting. The system is struggling to effectively track and manage the allocation and utilization of funds within the county government due to lack of proper training and capacity building for staff members responsible for using the system. This has led to errors in data entry, inaccurate reporting, and inefficiencies in fund management processes. Additionally, there have been instances of corruption and mismanagement of funds within the county government, which has further exacerbated the challenges faced by IFMIS. Lack of transparency and accountability in financial transactions has impeded system's ability to funds flow oversight and control effectiveness. Therefore, this review endeavors to ascertain integrated financial management system impacts on fund management in Kenya’s Homa Bay County. Specific questions were to establish the effect of IFMIS staff technical skill, IFMIS system quality, IFMIS internal control, and IFMIS risk control on fund management. Theories anchoring this study included agency, stewardship and technology acceptance theories. Utilizing descriptive research 98 respondents was chosen by stratified sampling from the 327 employees target populace of Finance and Economic Planning (FEP) department. To collect dat, a structured questionnaire was utilized where piloting was conducted to ascertain its’ validity and reliability. Descriptive statistics (mean and standard deviation), examined quantitative data. In order to examine how variables were interrelated and how much they affect each other, inferential statistics like correlation analysis and multiple regression analysis were employed. The study findings were presented using tables and figures. Diagnostic tests, including multi-collinearity, normality and heteroscedasticity, were done. Ethical considerations included adherence to Kenyatta University and NACOSTI guidelines, ensuring the integrity and transparency of the research process was upheld. The study found that IFMIS staff technical skill, IFMIS system quality, IFMIS internal control and IFMIS risk control had a positive significant relationship with fund management in Homa bay County in Kenya. The study concludes that the technical skills acquired by the County staff led to proper use of resources and allocation, leading to proper direction of funds to areas with the greatest need. The IFMIS system of the County was of high quality which had enhanced transparent financial transactions leading to lesser occurrence of mismanaged resources and corruption. IFMIS internal control had increased transparency enabling stakeholder to effectively monitor the allocation of funds and how they were being used which reduced embezzlement of funds assuring accountability of public funds. The IFMIS risk control made that County staff and other stakeholders accountable minimizing the occurrence of poor management of funds. The examination advices that the County should enforce targeted training programs focused on fund management principles and practices for IFMIS staff within the County. The County may consider to acquire enhanced user interface and experience to have a system that is more interactive and can be accessed by all the users. The County need to implement training programs continuously for those dealing with the County’s management of funds. The County embrace an inclusive staff training programs on administration of funds to enable them to be upto date with practices involved in management of risks and how IFMIS functions.