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Court's decision on CDF big leap in governance, accountability

A newly built educational complex at Karapul Primary School. The project is funded by the National Government Constituency Development Fund (NG-CDF). [Isaiah Gwengi, Standard]

In a landmark decision on a matter that has dragged in the corridors of justice for close to a decade, the apex court has pronounced itself on key structural defects on the Constituency Development Fund (CDF).

The timing of the decision is equally strategic politically and administratively. Just a day to Tuesday’s General election, it offered voters a chance to review the calibre of legislators they wish to elect and definitively clarified the constitutional roles and responsibilities of a Member of Parliament, Senator, Woman Representative and Member of County Assembly as representation, legislation and oversight.

Equally, the decision is a double-edged sword for the incoming Executive arm of the government at the national and county levels. On one hand, it is a relief for the fifth president of the burden of annulling illegality under the present constitutional order that has persisted for far too long. For the practitioners in public financial management, this decision has been long overdue. It is one thing that even the mighty Treasury mandarins dared not touch because of the underlying political ramifications.

On the other end, the decision has effectively robbed the Executive of a carrot that has sustainably been used to whip the legislature from their representation and oversight obligations to dance to the tunes of the powers that be. On several occasions, the outgoing administration has withheld the release of the CDF kitty to pressure MPs to pass controversial agendas in the House. The architects of the Building Bridges Initiative (BBI) had lined up a similar fund at the county level to entice the MCAs and the masses. This coercive power will be no more for incoming administrations.

Separation of powers

In a rejoinder to the decision of the Supreme Court, the outgoing Speaker of the National Assembly appealed to the incoming 14th august House to re-look at the matter swiftly to salvage the kitty. I’m not a lawyer, but having been a practitioner in public financial governance for the last decade, I can authoritatively project that there is absolutely no legal window to resuscitate CDF except by amendments to the Constitution itself.

To reiterate one of the resounding findings of the court, neither the longevity nor the popularity of the fund with the public can cure its constitutional, legal and structural defects in a democratic system of government. While the court made several definitive determinations, I would wish to highlight five key points devoid of legal jargon.  

One is the violation of the constitutional principle of separation of powers: Tracing the historical context of the Constitution, the court affirmed the people’s desire to limit the powers of the arms of the government, especially the excesses vested on the presidency. For five decades upto 2010, an imperial type of presidency consistently trampled on the rights of the people, abused public resources for political expediency and denied development to constituents opposing their excesses.

The third level of government

When convenient, the use of public funds was always an option to buy political loyalty. It is a much welcome finding of the court that the CDF kitty creates an incurable conflict of interest for any elected representative, even if their role was purely supervisory. It has been the basis on which many MPs have been re-elected or voted out. More importantly, how can an elected representative purport to oversee public funds in the trillions on the Executive when they themselves cannot account for the millions under their care? Is it possible to squander public funds for political survival and ask others to account?

Two is on the violation of our devolved constitutional order: The court makes two interesting findings that any legal scholar may want to explore further. First is the fact that the ‘community projects’ for which CDF is envisioned to finance can be construed and are indeed localised public services within the jurisdiction of the county governments. Secondly, the shareable revenue as defined by the Constitution can only be allocated between the national and the county governments. Any other allocation to the grassroots can only be through a conditional or non-conditional grant from the revenues allocated to the national government.

In essence, the court finds that the CDF Act creates a sort of third-tier level of government to implement community development projects that either lie within the jurisdiction of the county Executive or the national government. The functions of either level of government are unambiguously specified in the Fourth Schedule of the Constitution. The spirit of the Constitution was and still is that public funds follow public services to whichever level of government.

That would explain the chaos we have witnessed in the health sector over the past 10 years of devolution. While primary healthcare was fully moved to the 47 county governments, the truth remains that the national government never released the funds to the counties. In a similar vein, legislators cannot appropriate development projects or public services to themselves contrary to the Constitution and purport to allocate funds to them. Three is on the serious breach of the constitutional values of good governance and accountability: In their wisdom or lack of it, the 11th august House significantly watered down the high levels of probity envisioned in Chapter Six and 13 of the Constitution. While the Constitution sets a very high bar for both State and public officers, politics took the better side of the law, retaining the bad manners in politics and public offices intact.

As explained above, this ruling effectively removes the entanglement of the oversight arm of government from Executive roles. Unless they want to collect bribes in their individual capacities, legislators will have no option but to represent their electorate and oversee their funds effectively to prove their worth for re-election. Distribution of bursary cheques, buying school buses, and donations to burials and weddings will no longer be the yardstick to measure the worth of an MP.

In any case, removing at least Sh110 million from the control of each MP will significantly diminish the available cash at their disposal to advance their non-value-creating adventures.

The Auditor General's reports have consistently highlighted several cases of duplicitous reporting of community projects under CDF, county and national governments.

Four is on the weakening of the public financial management law and regulations: By design, the law establishes the National Treasury and the Cabinet Secretary in charge of it as powerful institutions in the administration of public finances. Unfortunately, the two institutions have failed to stand up strong in executing key provisions of the Public Financial Management Act 2012, PFM regulations of 2015 and delineating a robust framework for the internal audit function to offer an effective risk-based internal oversight. The two institutions have also in several occasions played into political expediency as opposed to providing a firm policy direction against the excesses of politics.

Other funds

Finally, the unsaid message from this ruling, though not exclusively stated in their decision, is to let every arm of the government stick to its lane.

That is what the people of Kenya declared in voting for the Constitution in 2010, not political wheeler-dealing. In a single stroke of the pen, other funds like the National Government Affirmative Action Fund, where Woman Reps have sway, and any County Ward Development Funds have been buried indefinitely.

No political shenanigans can breathe new lease of life to any of the funds associated with the legislature. If anybody wishes to keep the good poverty alleviation measures under CDF, then let them restructure it into a ward fund under the administration of independent community coordination committees. Existing Executive structures at either national or county governments can provide technical support. That way, legislators can effectively oversight without conflict of interest.