EFFECTS OF YOUTH ENTERPRISE DEVELOPMENT FUND ON SOCIO- ECONOMIC CONDITIONS OF YOUTH IN NAIVASHA AND GILGIL DISTRICTS

ABSTRACT
Youth in Kenya are face by various socio-economic problems such as poor housing facilities, lack of good medical services, poor sanitation, poverty, hunger, social exclusion, poor social networking, high crime rates, drug and substance abuse and unemployment. By addressing the youth unemployment challenge these socio-economic problems can be solved. On realizing these, the Government of Kenya introduced the Youth Enterprise Development Fund (YEDF), with an aim of supporting youth-owned enterprises as well as enabling youth to start new enterprises thus creating employment. Despite the introduction of YEDF, youth in Naivasha District are still faced with high unemployment rate leading to poverty, hunger and health related problems. The purpose of this study was to determine the effect of YEDF on socio-economic conditions of youth in the larger Naivasha District. The ex post facto research design was used. The study population was 1172 youth from the 51 YEDF funded groups. A sample of 182 youths was selected from the study population using stratified and proportionate simple random sampling procedures. An interview guide was used for data collection. Content validity of the instrument was determined through expert on youth development issues who included three lecturers and two Ministry of Youth Affairs and Sports personnel, while reliability of the data collection instrument was established from pretested data through split half technique, where the reliability coefficient of the two halves was calculated and found to be 0.79. Data was analyzed through the use of descriptive statistics such as percentages, frequencies and chi-square test for goodness-of-fit, at 95% level of confidence. The results indicated that YEDF had enabled youth to start and/or expand their micro and small enterprises, at total of 27 enterprises had been expanded, while four enterprises were started. Consequently small enterprises increased by 31.5%, while micro enterprises decreased by 28.5%. Chi-square test computed (x2(2,N=182)=9.8, p< 0.01.) indicated that YEDF had significantly changed youth income. The amount of monthly income committed to education and the number of youth who sought medical services when sick changed significantly. Further, the enterprises started or expanded through YEDF had employed some youth in Naivasha District and the youth standards of living had improved. Lack of information about YEDF was, however, a big challenge facing the youth. To improve the performance of the YEDF, the study suggests a need for the Youth Enterprise Development Fund Board to launch a campaign to educate Kenyan youth about the fund, intensify youth involvement, train youth on how to start and manage enterprises and to make the fund more easily accessible to the youth.

CHAPTER ONE
INTRODUCTION
Background Information
Different countries and international organizations have different definitions for the term youth. For instance, the United Nations (UN) defines youth as a young person aged 15-24 years, while the Commonwealth Association of Nations defines it as a person aged 15-29 years (Mkandawire, 1996). Most African countries have either adopted the UN or Commonwealth definition. However, the age range between 15 and 30 years is generally taken as representing the category of youth in Africa. According to Ministry of Youth Affairs and Sport (MOYAS, 2007), a youth in Kenya is a young person aged between 18-35 years. This group constitutes 32% of the entire Kenyan population (Ministry of Youth Affairs and Sports [MOYAS], 2008).

The youth in Kenya live in poor socio-economic conditions, which are characterized by: poor housing facilities, lack of good medical services, poor sanitation, poverty, hunger, influences from social network, high crime rates, drug and substances abuse, unemployment and underemployment, health related issues among others (MOYAS, 2007). Unemployment has driven the youth into high risk behaviour such as crime and drug abuse, youth gangs/illegal grouping and spread of HIV and AIDS. In addition, unemployed youths are a financial burden to the employed.

According to United Nation Development Programme (2009), Kenya is faced with high dependence burden, with over 50% of the population being below 15 years of age. This has resulted in high dependency ratios, placing high demands on social services such as primary education and health care. Section 25(1) of the Universal Declaration of Human Rights (UDHR) states that: “Everyone has the right to a standard of living adequate for the health, and well-being of himself and his family, including food, clothing, housing and medical care….” (United Nations, 1948). Despite the declaration, majority of Kenyans do not have access to affordable health care. According to the Central Bureau of Statistics (CBS) (2003a) report on Household Health Expenditure, 44% of Kenyans who fall sick do not seek health services due to lack of finances. Many of these are youth who lack the resources to access the needed services.

Education is vital to youth development. While the Kenyan government has made major efforts to improve the education system, much remains to be done, particularly at the secondary school level where access and relevance continue to be key constraints (Saitoti, 2007). According to McGrath (1999), schools are a positive force in the lives of young people and provide a place where they can interact and be socialized. However, a large percentage of Kenyan youth only have a basic level of education, few usable skills, and minimal employment opportunities. The education system that does not match the labour market and subsequent idleness of these youth create a dangerous combination that frequently leads to drug abuse, early pregnancy, crime, and antisocial behaviors.

According to the CBS (2002) report of 1999 Kenyan population and housing census, deficit of houses is a major problem in Kenya since the public sector makes minimal direct investment of only 4% of houses, while the private sector caters for the remaining 96% of houses. Though the private sector holds the bulk share of housing construction, it is less responsive to the housing needs of middle and low income as well as the disadvantaged members of the population of whom majority are the youth. Often the houses constructed are not commensurate to the demand and the few that are available are not affordable. This group is therefore, forced to compete for the houses constructed for the low income, who in turn are pushed out into the informal settlements that are crowded with limited or no infrastructural services (Lumumba, 2004).

Youth are further affected by the social networks which they are part of. These networks involve connecting with others in and outside the youth groups, sharing knowledge and information and uncovering hidden opportunities, but more importantly, it is about building relationships and getting to know people. On community basis, networking is crucial to personal and youth group development as everything is built on relationships (Brown, 2006). Brown further states that, for any youth group which is trying to develop a name for itself and starting up operations and programs aimed at developing the youth and the community, networking is critical to success. Youth groups, even if they do not realize it, are in a networking game, with the end result being either success or mediocrity. Networking has resulted into strong relationships and improving the lives of the youth and local residents. These relationships at times may lure the youth into antisocial behaviours such as crimes, drug and substances abuse, irresponsible sex behaviour among others.

The poor socio-economic conditions the youth are facing could be attributed to unemployment and underemployment, since the youth population forms 60 % of the total Kenyan labor force. The Labour Force Survey stated that, the Kenya economic growth has not been strong enough to absorb the annual 500 000 new entrants to the labour market (Central Bureau Statistics, 2003a). Unemployment and under employment among young people have fuelled frustration and desperation, leading some to engage in anti-social activities such as involvement in criminal acts, drug and substances abuse among others (MOYAS, 2007).

To respond to these challenges the Government of Kenya through the Ministry of Youth Affairs and Sports is encouraging youth to engage in entrepreneurship. The government introduced the Youth Enterprise Development Fund (YEDF) in 2006, with an aim of supporting youth-owned enterprises and to enable other youths to start micro and small enterprises. This is expected to create employment, which is in line with, the government economic recovery strategy (ERS) for wealth and employment creation (2003-2007).

The youth enterprise development fund (YEDF) has two components namely:

- The C-YES (Constituency Youth Enterprise Scheme): This fund is meant for the youths in a constituency, who are organized into groups as it gives loans to group projects and not to individuals.

- Funds channeled through finance intermediaries: This is meant for all youth owned enterprise in a district and it can be accessed by a youth group or an individual.

In the Naivasha and Gilgil Districts YEDF through the constituency youth enterprise scheme had funded twenty nine youth groups, while YEDF had funded thirteen youth groups through Equity Bank and nine youth groups through K-REP bank. (Naivasha District Youth Office, 2009). However, no study has been conducted in Naivasha and Gilgil Districts to determine the effects this fund has on the youth. Hence, this study sought to establish the effects of the C-YES and the Fund channeled through finance intermediaries on the socio-economic conditions of youth in the Naivasha and Gilgil Districts.

Statement of the Problem
YEDF was initiated in the year 2006 to address socio-economic challenges facing the youth in Kenya. These challenges are: poor housing facilities, lack of good medical services, poor sanitation, poverty, hunger, social exclusion, poor social networking, high crime rates, drug
and substances abuse and unemployment among the youth. The causes of these socio- economic problems facing the youth are related to unemployment. The initiation of the fund was a strategic move to arrest unemployment which is virtually a youth problem since 75% of youth are unemployed (Ministry of Youth Affairs and Sports, 2007). The fund was intended to enable the youth to start or expand their businesses, creating job opportunities for themselves and for others. Therefore the study was aimed at establishing the effects of YEDF on socio-economic conditions of youth in Naivasha and Gilgil Districts since not much had been documented about the YEDF in the two districts.

Purpose of the Study
The purpose of this study was to determine the effects of Youth Enterprise Development Fund on socio-economic conditions of youth in Naivasha and Gilgil Districts.

Objectives of the Study
i. To determine the types of enterprises created through YEDF in Naivasha and Gilgil Districts.

ii. To establish the number of youth employed in the enterprises created through YEDF in Naivasha and Gilgil Districts.

iii. To determine whether there is any change in income of the youth as a result of enterprises started or expanded through YEDF in Naivasha and Gilgil Districts.

iv. To find out the extent to which the YEDF has changed the standard of living of the youth in groups in the larger Naivasha and Gilgil Districts.

v. To determine the factors that motivate youth participating in YEDF enterprises to join social networks in the larger Naivasha District.

vi. To identify the challenges youth groups in the larger Naivasha District encounter in the process of accessing the YEDF.

Research Questions
i. What are the types of enterprises created through YEDF in Naivasha and Gilgil Districts?

ii. How many youth are employed in the enterprises created through YEDF in Naivasha and Gilgil Districts?

iii. Is there any change in the level of income of the youth as a result of participating in enterprises started or expanded through YEDF in Naivasha and Gilgil Districts?

iv. To find out the extent to which the YEDF has changed the standard of living of the youth in groups in Naivasha and Gilgil Districts.

v. What are the motivating factors for the youth participating in YEDF enterprises to join social networks in the larger Naivasha District?

vi. What are the challenges youth groups in the larger Naivasha District encounter in the process of accessing the YEDF?

Significance of the Study
The study is significant for both future practice and research. In terms of practice, several agencies could benefit from the results. For example, Ministry of Youth Affairs and Sports personnel may get to know the effects of YEDF on socio-economic conditions of youth as a result of this study. The youth could know whether YEDF had any effect on their socio- economic conditions, thus assisting them to make an informed decision of applying for the fund or not. The study findings could be useful in policy development by Ministry of Youth Affairs and Sports and any other development agency addressing the development issues of the youths. The study has highlighted the challenges the youth encounter in the process of acquiring and repaying the loan. Recommendations have been made, which may be applied by Youth Enterprise Development Fund board to enable it execute its full mandate and mitigate any negative effects to enable the youth realize their potential. Further the recommendation may be applied to enable the country achieve vision 2030 specifically economic and social pillars.

Scope of the Study
The study was conducted in Naivasha and Gilgil Districts. The study focused on the youth within the YEDF funded groups, that is, those funded By YEDF through C-YES and through finance intermediaries in Naivasha and Gilgil Districts. Specifically on the effect of YEDF on youth enterprises, youth income, youth employment, youth standards of living and factors that motivates the youths to join social networks as well as challenges youth encounter when accessing the funds.

Assumption of the Study
YEDF was meant to help the youth start income generating activities that would create employment for the youth. Therefore this study assumed that the fund was used to start or expand an income generating activity that created employment opportunities for the youth and it was still in operation.

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Item Type: Kenyan Material  |  Attribute: 75 pages  |  Chapters: 1-5
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