Not so fast, Mr President: New threat for Ruto's pet project as cases poke holes into new levy

President William Ruto assents to the Affordable Housing Bill at State House, Nairobi County.[PCS, Standard]

A day after assenting to the Affordable Housing Act, 2023, President William Ruto now faces another legal hurdle as the rocky path in implementation of his flagship project continues.

This is after six people moved to the High Court in Nairobi to stop its implementation. Of the six one filed as an individual the other five acted jointly.

Human rights defenders Eliud Matindi, Gikenyi Magayi, Pualine Nduta, Philemon Abuga, Shallum Kaka and Jamlick Otondi are challenging the new law signed by President William Ruto on Tuesday this week.

Matindi argued that MPs were ingenious to beat the judgment handed by Justices David Majanja, Christine Meoli and Lawrence Mugambi finding on discriminating salaried workers.

However, according to Matindi, MPs did not justify why salaried workers will be forced to pay the levy while it is still silent on those who have no salary.

He said it is also unclear how and why Kenya Kwanza based its allocation quota for those who have a lot of money and those who have less. According to him, this creates outright differentiation between the rich and the poor.

“By defining affordable housing in reference only to a percentage of a person’s monthly income and place of residence, the provision excludes persons who, though they may be in need of accessible and adequate housing under Article 43[1][b] of the Constitution, have no such monthly income. Further, the need for accessible and adequate housing is not dependent on whether a person lives in a rural or urban area,” argued Matindi.

Dr Magare Gikenyi and four others want the court to suspend commencement, levying and operationalisation of the Affordable Housing Act 2023 and any Act purporting to deal with affordable housing. 

The CS Lands, CS Treasury, the Attorney General, the National Assembly, and the Senate have been named as respondents in the case.

The National Land Commission, Kenya Revenue Authority, Law Society of Kenya, and Kituo cha Sheria, among others, have been listed as interested parties.

The petitioners also want the court to bar the government from evicting Kenyans from public land apparently for purposes of the Affordable Housing Act. The Affordable Housing Act, No. 75 of 2023 was published in the Kenya Gazette Supplement No. 236 of December 4, 2023, and passed by the National Assembly with amendments on February 21, 2024. The Bill was passed by the Senate on March 12, 2024, and signed into law by the President on March 19, 2024.

Matindi in his petition, argues that it is impossible to tell who in the Cabinet will be responsible for the levy. According to him, the new created a board but it is unclear who will be appointing it and the criteria.

He also took issue with Senate’s failure to call for public participation. According to him, Senate discussed the then Bill without seeking views from the public.

He said it is unclear how counties were roped in and how powers of the National Government will be donated to the board that will act on behalf of Kenya Kwanza. He said the Constitution is clear how national and county governments relate and what roles each play.

He claims the new law was hurriedly passed to salvage the previous Act that was declared unconstitutional by the court. Matindi asked the court to intervene until his case is heard and determined.

“Inclusion of the Senate in the process of approving and adopting the investment programs under the impugned provisions amounts to nothing as it [the Senate] is excluded from appropriating monies to implement the Fund’s work programs as enacted by  Section 9[1][b] of the impugned Act.

“Just as they who pay the piper call the tunes, no number of attempts to plug the unconstitutional holes in the impugned Act, including by roping in the Senate in approving the Fund’s work program, can salvage the sinking ship that is the Affordable Housing Act 2024,” argued Matindi.

The five petitioners jointly with Dr Gikenyi claim the government through the Act has taken over the housing function, which is the sole responsibility of county governments.

The levy, they claimed, disrupts the functional assignment under devolution. They have also claimed there is no evidence that county governments have transferred the exclusive Housing Function to the National Government.

They have also accused the national government of introducing a shadowy entity dubbed the “collector” which collects funds instead of the Kenya Revenue Authority.

They claim the action by the government to sell housing units to the people is unconstitutional as public land and funds are utilised. “The fund has been established with faulty legal framework and structures for implementation, making its application a matter for the executive’s discretion and, therefore, making it susceptible to abuse in violation of the principles of public finance under Article 201 of the Constitution,” they stated.

They noted that contributors are not guaranteed to benefit from the fund and that the fund subjects employees and other income earners to cruel, inhuman, and degrading treatment.