The National Treasury building in Nairobi.
The question of public participation came to focus on Wednesday, September 11, as judges of the Supreme Court sought to know what amounts to sufficient public participation in the legislation process.
The apex court led by Deputy Chief Justice Philomena Mwilu sought lawyers’ views, during the hearing of an appeal by the Treasury on the nullification of the Finance Act, 2023.
Lawyer Evans Ogada said whereas Parliament is not obligated to agree on every submission made before it by the public, the MPs have a duty to respect the memoranda forwarded to them by giving reasons for rejecting some of the proposals presented to them.
“Citizens are partners in government. The opinion they give should be respected,” he said adding that public officials should also provide timely feedback.
Senior counsel Kiragu Kimani for CS Treasury said Parliament is required to facilitate the process and which was made when National Assembly invited views and memoranda from the public before passing the Finance Act, 2023.
The lawyer submitted that although the participation must be purposive and meaningful, the Court of Appeal departed from its earlier decision, which stated that Parliament is not required to undertake fresh public participation in new proposals.
“The Court of Appeal, therefore, concluded that failure to give reasons renders the process leading to the enactment of the Act flawed. This finding is incorrect and a clear misinterpretation of the constitution and a departure from previous decisions,” Mr Kimani told the full bench of the Supreme Court presided by Chief Justice Martha Koome.
Mr Kimani said the decision by the Court of Appeal, while nullifying the Finance Act, 2023 for lack of adequate public participation would bring the legislative process to a complete halt and undermine Parliament’s ability to discharge its constitutional mandate.
In the ruling while allowing the appeal, the Supreme Court said the place and extent of public participation in the legislative process, and whether Parliament can amend bills after they have been subjected to public participation are some of the issues to be considered.
“Similarly, the parameters and considerations of a declaration of the unconstitutionality of a statute require our input as would the questions on the orders to be issued upon such a declaration being issued including whether to allow or disallow suspension or otherwise of the declarations to enable remedial action by the offending party,” the court said.
Mr Issa Mansur for Parliament said public participation is intended to inform the legislative process, not to dictate it.
The lawyer said the Court of Appeal’s judgment seems to misinterpret the role of public participation by implying that every public view must be individually addressed and justified.
“This is not the intent of public participation, rather, it is meant to provide a broad spectrum of public input to guide legislative decision-making,” he said.
While urging the court to overturn the court of appeal decision, Prof Githu Muigai said the judgement of the appellate court poses an immediate, real and immense challenge to the monetary and fiscal policy of the country.
Prof Muigai said if the decision is allowed to stand, it would obstruct the government’s ability to collect and allocate funds and the disruption challenges the foundational operations of the state, potentially leading to the inability to fulfil constitutional obligations.
Prof Muigai said the nullification would lead to a constitutional crisis given that the Finance Bill 2024 was withdrawn following the countrywide protests.
“Courts should avoid radical rulings that impede the running of the State. Declarations defunding the State, emptying the coffers should be taken in very clear flagrant violations of the constitution, which was not demonstrated in this case,” he said.
In an affidavit filed in support of the appeal, Treasury PS Dr Chris Kiptoo said it would not be logistically or practically feasible to immediately reconfigure the various state agencies and departments engaged in tax collection, to revert to the regulatory framework under the Finance Act, 2022.
“As it stands, the invalidity of the Finance Act, 2023 would require the government to immediately update all its platforms, revenue collection systems and software to reflect the relevant tax rates, tax brackets and tax treatment of various items to the legal regime that existed in 2022,” he said.
Dr Kiptoo said the configuration of systems entailed detailed engagement with various software and platform providers that require time for updates and due diligence.
The PS said the nullification of the revenue-raising measures by the court of appeal will lead to expenditure cuts across the national and county governments.
He pointed out that the nullification will affect for example, the conversion of Junior Secondary School (JSS) teachers into permanent and pensionable which will lose Sh18 billion, the Higher Education Loans Board Sh10 billion, Free Secondary Education Sh10 billion, pension gratuities Sh20 billion and payment of interest on loans Sh59 billion.
Others that will suffer cuts include roads Sh20 billion, water and irrigation Sh10 billion, fertiliser subsidy programme Sh7.5 billion, Universal Health Care (UHC)/ medical services Sh6.1 billion and country aggregation industrial parks Sh2 billion.
The court will notify the parties of the judgement. A temporary order suspending the Court of Appeal decision, which was issued by the apex court on August 20, is still in force.
