Why court agreed that counties can be given CDF cash for development

Parliament in session, October 6, 2022. [Elvis Ogina, Standard] MPs are still pushing to have the National Government-Constituency Development Fund (NG-CDF) revived. Two MPs have sponsored Bills seeking to entrench NG-CDF in the Constitution and have so far collected over 300 signatures from members to begin the process. In separate Bills, MPs Stephen Mule (Matungulu) and Robert Gichimu (Gichugu) want CDF entrenched in the Constitution and to increase allocation from 2.5 to 5 per cent of the country's annual revenue collection. That would see the allocation doubled to Sh88 billion each financial year. In August, the Supreme Court declared the fund unconstitutional. But Mule says outlawing NG-CDF puts the country in jeopardy and that is why they want to ensure it won't be subjected to any judicial challenges in future. Gichimu said the kitty does not benefit politicians as is widely assumed but is of benefit to poor Kenyans. But Katiba Institute lawyer Lempaa Suyianka, who instituted the NG-CDF case, says opponents have never challenged the nobility of the fund. "They challenged the process of enacting the law that creates the fund, the management of the fund, plus duplication of the roles of the national and county governments," he says. Lawyers are also opposed to violation of division of functions between the two levels of government and lack of oversight mechanism of the fund and separation of powers. It is true as MPs claim, billions of shillings are used largely to pay fees for students in primary, secondary and other institutions of learning, as well as to build classrooms and construct murram roads across the country. But the flip-side is that the same functions are being done by county governments and in some cases end up being duplicated. Successive reports done by the Auditor General as will be listed later in this article show massive plunder of NG-CDF money by MPs and those entrusted to manage the fund. The Supreme Court stunned MPs when it declared the fund unconstitutional on the eve of the August elections. The ruling came after a long-running court battle that began at the High Court in 2015 when a three-judge bench declared the Constituency Development Fund (CDF) unconstitutional. Justices Isaac Lenaola, Mumbi Ngugi and David Majanja declared the entire Act unconstitutional and directed Parliament to rectify the unlawful sections within a year. The MPs thereafter challenged the decision in the Court of Appeal and got a reprieve when three judges ruled that only sections of the Act were against the law. Justices Erastus Githinji, Hannah Okwengu and GBM Kariuki ruled that Sections 24 (3-c), 24 (3-f) and Section 37 (1-a) violated the principle of separation of powers but the rest of the Act remained operational. Two civil society groups, under Katiba Institute that had filed the case, moved to the Supreme Court which again ruled in their favour. "By trying to entrench the fund in the Constitution, the MPs are trying to keep out any court challenge to the fund that they so much love," says Suyianka. He further argues that the MPs want to hold onto the money because each constituency is given Sh100 million every financial year and therefore each is able to control Sh500 million in five years. The courts had agreed that through the rule of separation of powers the money can be channelled to the county governments to undertake the development the MPs seek to undertake. Although the appellate court reprieved CDF, it also found that MPs controlled the CDF board committee and influenced the selection, prioritisation of projects, allocation of funds and monitoring the implementation. "The appointment of MPs to perform purely executive duties of enforcing CDF is violation of the Constitution and principles of separation of powers and of national values and governance," said the judges. The MPs are also seeking to operationalise the Economic Stimulus and Empowerment Fund allegedly help vulnerable communities. The Senate is now also seeking to be allocated a similar kitty they call the Senate Oversight Fund to enable them carry out their oversight function over county governments. MCAs are also fighting to be allocated the Ward Development Fund from money that is allocated to devolved governments. Constitutional lawyer Stanislas Murunga contends that it will be interesting to see how Parliament will amend the Constitution because no legislation can revive a social fund that has been declared illegal. The lawyer also points at the malpractices unearthed by all audit reports that have been released since the inception of CDF during President Mwai Kibaki's administration. Legal practitioners disagree with MPs who insist that what the Supreme Court declared unconstitutional was the CDF Act 2013 and not its successor, NG-CDF Act 2015. Murunga argues that MPs must not be involved in direct management of any public resources but stick to the functions of representation, legislation and oversight that are assigned to them by the Constitution. The other reason lawyers support Chief Justice Martha Koome contention that NG-CDF offends the division of functions, is because delivery of service is devolved to county governments, where constituencies also belong. In a report covering up to June 30, 2017 that was tabled in the National Assembly by then Majority Leader Aden Duale, Auditor General Edward Ouko revealed that no documentation had been produced to back up huge NG-CDF expenditures. About Sh5 billion was allocated to the NG-CDF for 290 constituencies that year, but the audit revealed that many constituencies failed to account for expenditure. Multi-billion shilling projects have also stalled or have not been implemented as reported over the years. The auditor has also questioned the variations between budgeted and actual expenditures on the compensation of employees and other government expenditures. The audits also revealed unauthorised reallocation of bursary funds of hundreds of millions of shillings in many constituencies. In 2017 for example, Ouko said eight constituencies could not account for about Sh1 billion allocated to them from the NG-CDF. His successor Nancy Gathungu has also repeatedly cited unexplained usage of taxpayers' cash in many constituencies. Last year, her audit report exposed major projects done by the fund that remained incomplete despite billions being spend over the years. In many constituencies, the fund management could not provide admission numbers of students who allegedly benefited from the fund while in some cases fictitious or duplicated names were provided. In other areas the fund billions to purchase parcels of land whose title deeds were in the hands of a third party or had no documentation. The misuse of public resources was also exposed where some MPs allegedly used large sums to buy tree seedlings for distribution to schools that could not be identified due to lack of recipient documentation. Poor workmanship also characterised many projects across the country, coupled with other anomalies that pointed to wastage of NG-CDF funds. It was also discovered that the fund has become a gravy train for constituency committee which meet so many times to draw sitting allowances. Gathungu gave an example of a constituency members were supposed to sit six times but the committee held 29 meetings. "This resulted in payment of committee allowance amounting to Sh205,000 which were not justified or explained," she said. Whereas county governments are supposed to construct health facilities in wards, MPs have also gone on a spree of constructing Kenya Medical Training Centres. And so hospitals have been built but they remain unoccupied due to lack of staff and other challenges, largely because county governments are also fighting to equip similar facilities. Questions have also been raised about the priority of some projects like a six-storey CDF office that was constructed in Lurambi at a cost of Sh155 million.

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