Kenya: Appellate Court Holds Key to President Uhuru Kenyatta’s Legacy Projects

President Uhuru Kenyatta’s legacy projects are in serious jeopardy unless the Court of Appeal reverses the High Court judgment that nullified 23 laws enacted by the National Assembly.

More than Sh900 billion has been allocated on food security, manufacturing, affordable healthcare and housing.

Among the nullified laws, the Finance Act, 2018 and the Tax Laws (Amendment) Act, 2018 are crucial in mobilising funds for affordable housing and universal health coverage (UHC).

Read: KRA in dilemma over ruling on illegal laws

Parliament’s failure to regularise the 23 laws within nine months as directed by the three-judge bench has left them impracticable.

In its ruling on October 28 last year, the High Court said the laws were passed unconstitutionally as Speakers of the two houses did not consult to establish whether the Bills concern county governments.

The Senate had filed a petition, saying it wasn’t involved in the passage of the laws. The nine months within which the National Assembly and Senate were to regularise the laws end on July 28.

After the ruling, the National Assembly filed an appeal that’s coming up for hearing on Wednesday.

“The National Assembly has asked the Court of Appeal to extend the validity of the 23 laws until the case we have filed is heard and determined,” said the clerk, Michael Sialai.

There were no conservatory orders against the nullification of the laws, meaning they shall be null and void on Thursday.

The Finance and Tax Laws (Amendment) are the legal frameworks within which the Treasury collected taxes and appropriated the funds to various projects.

There was also recurrent expenditure, including payment of salaries for civil servants. If their nullification stands, it’s not clear whether the collection of taxes during the 2018/19 period was done legally.

It’s also unclear whether all projects undertaken using the taxes collected were legal, or if the payment of salaries to civil servants was irregularly done.

“This will cripple key operations of the government and is unprecedented. What courts have done previously is to impugn the provisions that were in question whether they concern county governments or not but not to declare the entire Act unconstitutional,” a parliamentary official told Nation.Africa.

“The power to veto an entire Act as per Article 115 of the constitution belongs to the President in the presidential system,” he added.

Huduma Namba, housing affected

The appeal meant that the laws could not be regularised as advised by the three judges until it’s heard and determined. As this happens, the 23 laws directly affect 150 others. Also affected are Huduma Namba and the National Government-Constituency Development Fund (NG-CDF).

The Finance Act 2018 provided for funding of UHC through payment of excise duty at 16 per cent in terms of mobile money transfer and exemptions of goods used in construction and equipping of specialised hospitals.

The law also established the National Housing Development Fund (NHDF) for affordable housing and was to be used by employees to finance the purchase of a first home.

On the other hand, the Tax Laws (Amendment) Act 2018 made provision for affordable housing relief.

This means that on Thursday, the Finance Act and the Tax Laws (Amendment) Act shall stand nullified and toss the Big Four agenda out of the window. Interests on loans and cost of petroleum products and food commodities could go up.

Huduma Namba, serviced by the National Integrated Identity Management Systems, registered 38 million Kenyans in the initial phase in 2019, costing the taxpayer Sh9.6 billion.

In the current financial year, the Treasury allocated Sh1 billion for the second phase that will push the total cost to Sh10.6 billion. It’s meant to be used to access public services.

The annulment of the Registration of Persons Act means that Huduma Namba will remain a mirage despite the efforts that the government put in to ensure all Kenyans are registered.

Former Majority Leader Aden Duale, under whose watch the 23 laws were passed, said the court erred.

“Articles 109 to 111 of the constitution make it clear which Bills go to what House for consideration and which ones are exclusive to the National Assembly,” Mr Duale said.

“The courts cannot just annul laws because they did not pass through the Senate. If anything, they should have pointed out the offensive sections that needed to be corrected. The courts must not appear to prefect the affairs of Parliament,” he added.

The Kenya Coast Guard Service Act, which establishes the unit and provides for its functions in provision of maritime security, is also affected. This comes at a time the country is facing various security threats from war-torn Somalia.

The invalidation of the National Youth Service Act will also see the abolishment of the unit. The NYS has provided voluntary work and training programmes for the youth.

Other finance-related legislations could also be declared unconstitutional, as well as the Statute Laws (Miscellaneous Amendment) Act 2018.


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