THE EFFECTS OF UNSERVICEABLE ASSET DISPOSAL ON PERFORMANCE OF GOVERNMENT MINISTRIES IN KENYA; A CASE OF THE NATIONAL TREASURY

ELIJAH WILLIAMS WAHOME

Abstract


There is a major problem with government ministries in Kenya in managing unserviceable assets. A preliminary visit to the office complexes, compounds, stock yards, parking lots and main stores of most government ministries reveals unserviceable stores strewn all over the yard, unserviceable motor vehicles lining up the parking lots, and unserviceable office equipment and furniture piling in the main stores. This problem has been so severe in government ministries that government has incorporated asset management in Cabinet Secretaries performance contracts as a key performance indicator. When any equipment is unserviceable its keeping through maintenance costs, storage, parking insurance, etc., may well exceed the returns that can be derived from that piece of equipment and the investment of additional monies. Disposal is thus one of the prudent elements of managing procurement, supply and distribution in any sector, private or public in enhancing its performance. It is estimated that inefficiencies in the processes of public procurement and disposal cost Kenya about Kshs. 30 Billion annually. This is due to poor procurement and disposal planning. The objective of this study was to determine the effect of unserviceable asset disposal on the performance of government ministries in Kenya, a case of the National Treasury. The target population was the three hundred and forty members of staff at the ministry of The National Treasury in top, middle and lower management. A sample size of 51 was picked through stratified simple random sampling. The instrument of data collection was a questionnaire with open ended and closed questions. Primary data was collected through questionnaires from respondents while secondary data was collected from books, journals, reports, conference papers and other academic literature through literature review. The data collected was analyzed and presented in frequency tables. The findings from the study running the linear regression analysis indicated that if adequate control in inventory was used then the performance of government ministries would improve. The study recommended that frequent disposal of unserviceable assets would help reduce unnecessary costs whereas at the same time generate some additional revenue that could be used for alternative development agendas thereby improving the performance of government ministries.

Key Words: Unserviceable Assets, Performance 

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References


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