With threats of strikes seemingly coming in from every direction in the public service, any patriotic Kenyan who has been paying attention to the dire state of our coffers in recent months has probably found themselves asking the question, “Where did the rain start beating us?”
The answer has its roots in a series of deliberate legislative manoeuvres that have eroded the checks and balances in Kenya's constitution.
The crux of the matter lies in the unholy alliance between Kenya's Executive and the legislative arm. Over the last decade, we have witnessed a disturbing trend of constitutional mutilation that has facilitated fiscal recklessness on an unprecedented scale.
Take, for instance, the 2014 amendment to the Public Finance Management Act spearheaded by Aden Duale, the current Environment CS.
As a senator, I cannot help but be fiercely protective of the constitutional clauses that safeguard devolution and our country’s financial health. Articles 206 and 207 of the Constitution are crucial in this regard.
Article 206 mandates that all government revenue be deposited into the Consolidated Fund, with withdrawals only allowed through parliamentary approval, ensuring transparency in national spending.
Article 207 governs county finances, requiring all county revenue to go into a County Revenue Fund, with expenditures similarly subject to lawful allocation. Together, these articles are essential for preventing financial mismanagement and promoting fiscal responsibility at both national and county levels.
However, President Uhuru Kenyatta's signing of the Public Finance Management (Amendment) Bill on May 8, 2014, gave the National Treasury unchecked authority to borrow money or use government assets as collateral without proper oversight.
By bypassing the Consolidated Fund, this amendment circumvented the constitutional requirements for transparency and accountability, shifting vast borrowing powers from the National Assembly to the Cabinet Secretary of Finance.
How this amendment was smuggled into law raises serious questions about the integrity of our legislative process and the role of pre-publication scrutiny in Parliament.
Troublingly, the amendments were never presented for debate in the Senate because the Bill was deemed "not concerning county governments." This oversight reflects a concerning disregard for the significant implications of the legislation.
As we grapple with the reality of our current debt crisis and take stock of the lessons, we must ask ourselves what can be done to rectify this situation.
One possible solution is to challenge the legality of these amendments and the debts they have facilitated. If these loans were acquired in violation of the Constitution, why should we, the Kenyan people, be held liable for them? This question merits serious consideration.
Through the recent protests, Kenyans made it clear that they are tired of the status quo and demand a reboot of the system. President William Ruto has acknowledged their concerns, albeit reluctantly.
It’s time to take concrete steps to address the systemic issues that have led us to this point. This includes revisiting and potentially reversing the amendments that have allowed unchecked borrowing and spending.
The recent debate over the operationalisation of the new Social Health Insurance Fund has highlighted yet another instance where legislative amendments have been used to create opportunities for self-enrichment.
The appointment of an external administrator for the fund, with the power to vet institutions for inclusion in the panel smacks of cronyism. Do we really need to waste public resources fighting these battles in court, or can we prevent them from arising in the first place?
In this regard, the Hansard record of the heated debates leading to the passage of the PFM (Amendment) Bill is particularly instructive on how Parliament can steer the country toward financial ruin. Former South Mugirango MP Manson Nyamweya stood almost alone in his vociferous opposition to the Bill.
Ironically, after Duale moved the Bill it was seconded by then-Gwassi MP John Mbadi who is now the newly-minted Treasury CS. Despite initial reservations, Mbadi supported the Bill, which paved the way for Kenya’s debt to balloon from Sh2.4 trillion in 2014 to Sh11.2 trillion as of January 2024.
As our new man at the Treasury, one hopes Mbadi has learnt from past mistakes and won’t hesitate to support amendments that correct the disastrous changes Parliament made to the PFM Act in 2014.
