Employees’ Perception of Determinants of the Effectiveness of Performance Contracting on Service Delivery in Local Authorities in Kenya

Abstract

This study was an assessment of employees’ perception of determinants of the effectiveness of performance contracting in service delivery in local authorities in Kenya. It has become a common trend to find public outcry on quality of services in public sector, which includes local authorities. Despite the resources of the national government, inputs and concern on improved service delivery, performance of local authorities on service delivery is far below expectation. This concern triggered the introduction of performance contracting as a solution to improved service delivery and accountability. It is for this reason that, the current study sought to assess the employees’ perception on determinants of effectiveness of performance contracting in service delivery in local authorities in Kenya. The study objectives were: to assess whether management and leadership influence performance contracting; to establish whether financial management has an influence in performance contracting; to determine the effect of information technology in performance contracting; to evaluate whether human resource management has an influence in performance contracting; to determine the role of governance in performance contracting. Correlational research design was used to conduct the study in 175 Local Authorities in Kenya as per the Ministry of Local Government. The study used a selection sample of 18 local Authorities using a stratified systematic sampling technique. Structured questionnaires were used for data collection from local authority employees. The study findings indicated that the causes of in-effectiveness of performance contracting include leadership style, financial management practices, human resource management practices, information technology and governance practices. The variables had a positive effect and significant relationship with effectiveness of performance contracting. This implies that an increase in the effectiveness of these variables leads to improved effectiveness of performance contracting in local authorities and vice versa. The study recommends that best practices in the area of leadership, financial management, human resource management, and governance and information technology, be applied continuously and cascaded to the lowest cadres of staff. The recommendations may be critical to the successful running of the county governments that takes over the services performed by local authorities.