Parliament may not agree, but CDF is unconstitutional and this is good for Kenya
Saturday March 07 2015
Putting a man in parliament is nearly as expensive as putting a man on the moon, lamented a jaded critic of political extravagance.
The recent High Court judgment in Kenya holding the Constituencies Development Fund (CDF) unconstitutional, will not cut that expense but it will deny MPs a much beloved sinecure, and perhaps focus their minds on their real job: Oversight and legislation, not project management.
Members of Parliament have responded as they usually do to any threats to their perquisites: With warnings to the judiciary and threats to amend the Constitution to overrule the judgment.
Opposition leader Raila Odinga has even offered them the “Okoa Kenya Referendum Campaign” as a vehicle to that end. These self-serving and graceless responses do not do justice to this lucidly written, thoughtful and closely argued decision.
Both the MPs and Mr Odinga are wrong: The decision is good for Kenya and should be an inspiration to judges in the region.
First, it potentially helps thaw the frosty relations between the Senate and the National Assembly, by making it clear that laws that ought to be passed by parliament but are passed only by the National Assembly without the Senate are illegitimate.
Second, it underlines that laws passed without public participation are invalid because that participation is a question of substance, not merely form.
Third, it affirms the autonomy and competence of county governments to oversee and execute functions in their area of mandate.
Finally, it affirms that separation of powers means something and that parliament acts illegally when it delegates executive powers to itself, no matter how benevolently it then uses those powers.
The conclusions become clear on a careful study of the judgment. Four questions were set down to be decided in this case. One: Was the process of the enacting of the CDF Act constitutional? Two: Did the CDF Act violate the principles of finance and division of revenues set out in the Constitution? Three: Did it violate the division of functions between the national and county government? Finally: Did the Act violate separation of powers?
Let’s take each of these questions in turn.
The process by which the Act was passed was challenged on two points: First, that though this was a law “concerning counties,” it had not been made with the support of the Senate and second, that the law was passed without public participation, thus violating an explicit requirement laid down in the Constitution. As the High Court noted, were it to find that the legislative process had failed on either or both of these two scores it would have to declare the statute invalid.
The first issue, related to the role of the Senate, was whether the CDF was a law “concerning counties.” If it were, the Constitution mandates that the Senate be involved. The glitch, as the Court recognised, is that term “concerning counties” is not defined.
Formally, the Constitution requires that before legislation is introduced in parliament, the Speakers of the two Houses, the Senate and the National Assembly, hold a preliminary meeting to agree whether, in fact, the Bill “concerns counties.” If they conclude that it does not, that Bill is introduced only into the National Assembly.
Typically, the two Houses have treated the Speakers’ decision as conclusive. But this consensual approach has a problem: It leaves room for inter-chamber horse-trading and it is not open to scrutiny. The High Court clearly recognised this and noted, correctly, that the “participation of the Senate in the legislative process is not just a matter of procedure,” that is, formal gentlemen’s agreements or mere acquiescence of one House to the wishes of the other.
The involvement of the Senate is central to the constitutional scheme. Thus, even though the decision of the two Speakers that a Bill does or does not concern counties should be respected it “cannot be conclusive and binding on the Court.” It remains the duty of the Court to decide “the true nature of legislation.”
On this point, the Court concluded that, in fact, the subject matter of the CDF Act was a matter concerning counties and so the fact that the Senate was not involved in its enactment rendered that law unconstitutional.
On the question of public participation, the High Court relied on the decision of the South African Constitutional Court in the Doctors for Life International vs Speaker of the National Assembly and Others. In that case, the court held that the right to participate is broad: It includes not only the twin rights to vote or be voted into office but also the right to debate and dialogue at public hearings. The right also imposes a correlative duty on public bodies; they must facilitate effective participation by giving the public both information and meaningful opportunity.
In this case, the amendments to the CDF Act were fast-tracked through the National Assembly.
First published on August 2, 2013, it was introduced in the National Assembly on August 6, 2013 and debated and passed the same day. It was then published in the Kenya Gazette two days later, on August 8, 2013, and assented to by the president on September 13, 2013. There was little opportunity for public participation in this compressed timeline.
Nonetheless, the Court argued that public participation was not merely a matter of form but primarily of substance. The saving grace here was that before the Bill was published, a task force had been set up to consult with and receive public views. This pre-enactment consultation substantively satisfied the public participation requirements set down in law.
The Court then turned to the second question: Did the CDF Act violate the principles of finance and division of revenues set out in the Constitution? The answer turned on how one read the revenue-sharing requirements. Under the Constitution, county governments should get at least 15 per cent of “all revenue collected by the national government.”
In this case, the argument was that the national government is not allowed to set aside any fund from the total annual revenues before the money is split between the national government and the county government. Yet this is precisely what the CDF Act had done.
That Act stated that the Constituencies Development Fund would be a national fund “consisting of monies of an amount of not less than two and half per centum of all the national government ordinary revenue collected in every financial year.” Meaning that the CDF Act required that the government set aside 2.5 per cent of its annual revenues as CDF before those annual revenues are shared between the counties and the national government.
The Court noted that by reducing the overall revenue available to be shared, the CDF affected the amount available to the counties. And yet there was no provision in the Constitution that contemplated that a constituency would be “one of the beneficiaries of the national revenue before it is divided between the national and county government.”
It is this that made the CDF Act unconstitutional: It tried to authorise what the Constitution neither permitted nor contemplated and compounded that sin by establishing both a funding scheme — the CDF fund — and a spending unit, the constituency, that were unknown to the Constitution.
The third question was whether the CDF Act violated the division of functions between the national and county governments. The nub of the claim was that the Act spoke in general terms that made it unclear what type of projects CDF would actually implement. The problem was that if implemented as designed, CDF would dismember the system of shared powers and co-operative government established under the Fourth Schedule of the Constitution. That Schedule enumerates the powers of the county governments, those of the national government and also delineates the powers that are shared by the two.
That Fourth Schedule establishes no other unit of government. The constituency is, in fact, a sub-unit of the county. Meaning that the administration of development projects in constituencies fall, in the first place, under the county government. Given this, how is the CDF, which is funded by the national government, to undertake “unspecified” projects in constituencies without interfering with the functions of county governments?
And herein lies the fatal failure of the CDF Act: By failing to spell out the projects that CDF would fund, the Act left it unclear to what level of government CDF activities belonged. The infirmity lay in the fact that the drafters of the Constitution did not create a three-tier system with operational governments at the national, county and constituency levels.
Central versus County govts
What this meant was simple: Counties are distinct and self-governing units and, if the national government wants to make grants to them, it must leave it to them to execute the projects according to their own plans.
On the last question, whether the CDF Act offends separation of powers, the issue boiled down to this: Was it constitutionally permissible for MPs to participate directly in CDF projects as implementers? Put differently, can it be legitimate that those who vote money and provide oversight in one capacity to be also implementers and executors in another capacity, weakening both oversight and execution?
The Court scrutinised the structures that MPs had set up to manage CDF and found that the National Assembly had its footprints all over the system.
One, the Act had established a National Assembly Select Committee with sweeping powers over all matters CDF. The Committee was mandated to oversee not only “the implementation” of the Act but also the “policy and legislative framework for the fund.” It had to continually report to the National Assembly. Two, the fund was vested in the CDF Board, which was itself to report the National Assembly Select Committee regularly: Summarising all the project proposals received and the status of disbursements.
Three, at the county level, the Act created a County Project Committee composed of the Senator, Members of Parliament from that county, a county women representative, the Governor and a national government official at the county.
Reviewing these structures, the High Court had no doubt that the CDF was a third entity “grafted from the national government that operates within the county governments but outside their structures.”
That both Senators and members of the National Assembly were involved raised two constitutional problems: First, it threatened the division of functions between the national and county governments.
Second, the Act conflated executive and legislative functions and so sapped and undermined the accountability mechanism envisaged under the Constitution.
What is to be done? MPs complain that the Court has killed a good thing and that they will use their power to amend the Constitution to revive it. They are wrong on both scores. That something is good is not grounds for affirming its constitutionality. It may be a good thing to confiscate idle land from the rich and give it to the poor. It is not constitutional.
Less obviously, the MPs have failed to see how their infatuation with CDF has nurtured incestuous ties with the executive and weakened oversight in the process. It is now commonplace that if the president wants to fund a pet project, he can usually have his way so long as he is willing to trade support for it with some freebies to MPs, CDF increments included.
Second, because MPs see CDF as their ticket back to the House, they not only invest more time in matters CDF but also brook less scrutiny of its wastefulness. By assuming an executive function that they do not implement well, the MPs have undercut their own ability to scrutinise and hold the executive to account for those things that it implements poorly or dishonestly.
MPs think that they can rescue CDF by amending the Constitution. Okoa Kenya seems ready to support this astonishing folly. Unfortunately, it is hard to see that an amendment will help. Not all constitutional amendments are permissible. Some constitutions make this explicit by having “eternity clauses,” that is, clauses that cannot be amended, no matter how large the majorities that support them.
The Constitution of Turkey, for instance, bars amendments that would change the secular, republican and democratic character of the country. In a famous case in 1971, the Turkish Supreme Court rejected an amendment to the Constitution that formally complied with all the procedures for amendment but contradicted the fundamental principles of the Constitution.
In other countries, such as India, amendments to the Constitution have been rejected by the courts because they alter the basic structure of the Constitution. In the leading case of Kesavananda Bharati v. State of Kerala (1973), the Supreme Court ruled that three amendments, the 24th, 25th, and 29th, were unconstitutional because they violated “the basic structure of the Constitution.”
To illustrate, if, for instance someone were to propose a constitutional amendment to convert India’s democracy into military rule, the court would hold such an amendment unconstitutional because it converts the basic structure of secular, civilian democracy into a non-consensual military rule.
A constitutional amendment that restores CDF and retains MPs as implementers fundamentally violates the basic structure of checks and balance established by the Constitution. It may, for that reason alone, be held unconstitutional.
And so long as this possibility exists, a CDF entrenched in the Constitution would still be challenged in Court. In short, whether with Okoa Kenya or on their own, any attempt by MPs to constitutionalise CDF is a fool’s errand.
It were better if instead of flailing around the constituencies like development NGOs in search of projects, MPs now rose to the roles they were elected for in the first place: Representation, legislation and oversight.
Wachira Maina is a constitutional lawyer.