MPs not giving up fight on CDF, rush to have kitty in constitution

Although the constitutionality of the NG-CDF Act has not been successfully challenged again, petition lawyers say it did not change enough to fulfil the requirements of the High Court ruling. The NGOs that filed the successful petition have stated that they will go to court again because they say the NG-CDF creates a third level of government not contemplated in the constitution.

Before he left office last month, Treasury CS Ukur Yatani told MPs that CDF would not be released because of the High Court ruling, ignoring protests by MPs that the 2015 Act had not been quashed. That has put the MPs into a spin, hence the filing of separate bills by Stephen Mule Matungulu and Gichugu Robert Gichimu seeking to entrench CDF in the constitution. They also want to increase allocation from 2.5 to 5 per cent of the countries annual revenue collection.

That would see the allocation doubled from the current amount of Sh44 billion to Sh88 billion each financial year. Mule laments that outlawing NG-CDF puts the entire country into jeopardy and that is why they will ensure it won't be subjected to any judicial challenges in the future. Gichimu also responded that the NG-CDF kitty, "does not assist politicians" as is widely assumed but instead plays a big role in assisting poor Kenyans.

But Katiba Institute lawyer Lempaa Seyianka who instituted the case responds that CDF opponents have never challenged the nobility of the fund.

"They have 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 flipside is that those same functions are also being done by County governments and in some cases end up being duplicated. Successive reports done by the Auditor General also shows questionable use of NG-CDF money by some MPs and those entrusted to manage the fund. The Supreme Court stunned MPs when it declared the fund unconstitutional on the eve of the 2022 general elections held in August this year.

The ruling by the apex court 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 12 months. 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 among them Seyianka however moved to the Supreme Court which again ruled in its favour in the August decision.

"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 Seyianka.

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 Sh0.5 billion in five years. The courts had agreed that through the rule of separation of powers the money can be channeled 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 operationalize the Economic Stimulus and Empowerment Fund to 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 functions of oversighting county governments.

Members of County Assemblies (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 lawyers also point at the malpractices unearthed by audit reports that have been released since the inception of CDF during President Mwai Kibaki's administration. Legal practitioners also disagree with MPs who insist that what the Supreme Court declared unconstitutional was the CDF Act 2013 and not its successor, the National Government Constituency Development Fund (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 why 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 Sh5b 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 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.

Questions have also emerged on use of funds by constituency committees and number of meetings held where they 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.