Kenya’s Court of Appeal has made a significant decision by overturning the suspension of the 2023 Finance Act. The suspension had been put in place following Treasury Cabinet Secretary (CS) Prof Njuguna Ndung’u’s assertion that the government was losing an estimated half a billion shillings per day due to the freeze.
A panel of three judges at the Court of Appeal lifted the suspension, which had been implemented on June 30, while an appeal filed by Prof Ndung’u was being considered. The appeal had been brought to the court by Attorney General Justin Muturi, arguing that the government stood to lose approximately Ksh 211 billion ($1.48 billion) in the current financial year if the freeze continued.
Prof Ndung’u emphasized that the freeze would impede the Kenya Kwanza administration’s ability to execute the 2023/24 budget as planned. Moreover, certain projects would need to be suspended if the proposed revenue generation measures in the Finance Act were not allowed.
The Court of Appeal, in their ruling, highlighted the interdependence of the Finance Act and the Appropriation Act. While the former dealt with revenue generation, the latter focused on expenditure. The judges stressed that without resources being generated as stipulated in the Finance Act, the government’s ability to spend effectively would be compromised.
Though the exact figures were a point of contention, the judges acknowledged that Prof Ndung’u had projected generating Ksh 211 billion with an estimated daily rate of Ksh 500 million ($3.51 million) through the Finance Act’s implementation.
The court’s decision is seen as a victory for President Ruto’s administration, as it paves the way for budgetary operations to proceed without further hindrance. The court made it clear that the government had met the necessary criteria to warrant the lifting of the suspension and that the public interest was in favor of such a decision.
The appeal will now proceed, with the court aiming to hear and determine the matter within 60 days. The initial suspension had been put in place on June 30, pending the resolution of a petition filed by Senator Okiya Omtatah and six other activists
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