BY SAM ALFAN.
The Controller of Budget has been temporarily barred from withdrawing a circular she is issued in January relating to disbursement of bursaries by county governments.
Nakuru High Court judge Samuel Muhochi issued the order, restraining Controller of Budget from withdrawing, retracting and or interfering with its circular (OCOB/CIRCULAR NO. 1/2025) issued on January 14, 2025.
The court restrained the Controller of Budget from going against the Circular by authorizing and approving any county requisitions for expenditure on bursaries and other education support programs targeted at universities, primary, secondary and special schools which are not accompanied by requisite inter-governmental transfer agreements.
Judge Muhochi further restrained the controller of budget from implementing any agreement reached with the National Government Constituencies Development Fund (NGCDF) during the 26 delegate Intergovernmental Budget and Economic Council (IBEC) in so far as the agreement undermines the contents of the Circular and the reliefs sought in the petition.
Katiba Institute and Laban Omusundi through lawyer Henry Gichana petitioned the court to restrain the Controller of Budget from reversing the circular.
The lobby group said it was in public interest that the issues raised in the petition are preserved and given due consideration.
This was because they impact on the right to education of children across the country, involve billions of taxpayers’ money that is misapplied and misappropriated, and their continuing unconstitutionality has a broader impact on the sanctity of Kenya’s constitutional framework.
“This Petition raises the following questions of law for interpretation under Article 165(3)(b)&(d) on whether the provision of education-related support by counties towards functions that are otherwise national government functions, either directly or through county-enacted legislation, violates the Constitutional division of functions,” the lobby said.
The lobby wants the court to determine whether the controller of budget has the power to disallow withdrawals of funds for these functions even though such expenditure has been authorized under county legislation as well as annual county budgets.
The petition is also seeking to clarify whether the failure by the Senate to put an end to expenditure by counties on these functions, as well as the associated misappropriation, violates their constitutional oversight role.
The court is being asked to determine whether the lack of a harmonized national framework as well as guidelines for the provision of education support by the national government violates constitutional principles as well as the rights of learners.
“These constitute substantial questions of law under Article 165(4) as they are undetermined in law; their determination will affect not only the parties but all 47 counties as well as all learners across the country, their disposal will require a substantial amount of time given that the Amended Petition alone,” said the lobby.
It is the argument of the petitionees that granting the prayers sought will require a great deal of intergovernmental negotiations and compromises towards constitutional compliance to ensure continued access to education for thousands of learners who are beneficiaries of these support programs,” states petitioners.
The Controller of Budget issued a circular (OCOB/CIRCULAR NO. 1/2025) to all County Executive Committee Members for Finance titled “Clarification on Functions of County Governments Towards the Provision of Education Support” (Circular).
The lobby says the Circular was worded in terms similar to and appeared to give effect to the reliefs sought.
In the Circular, the controller of budget stated that, Part 1 (Section 16) of the Fourth Schedule of the Constitution designates universities, tertiary educational institutions, primary schools, secondary schools, and special educational institutions as national government functions.
Part 2 (Section 9) of the Fourth Schedule assigns pre-primary education, village polytechnics, homecraft centers and childcare facilities to county governments. Consequently, for a county government to offer educational support towards functions classified under Part 1, there is need to transfer the function in accordance with Article 187 of the Constitution.
“[Therefore] Any requisition for withdrawal of funds to perform functions categorized as national government functions must be accompanied by the requisite intergovernmental agreement as prescribed by the law,” stated the document.
The lobby group argued that constituted a restatement of the law pursuant to the Controller’s mandate under Articles 228(4) & (5) of the Constitution.
According to the lobby group and Omusundi, the Circular was, however, unfavourably (“angrily”) received by members of the Council of Governors, who, through press statements, opposed it.
The council of governors further faulted the Controller of Budget and resolved to continue offering bursaries and scholarships (through its members) and also to engage the Presidency on the issue.
The backlash is alleged to have softened the stance taken by the Controller of Budget, arguing that the Circular was misunderstood and was not intended to stop counties from issuing bursaries.
The court heard that on 27 January 2025, during the 26th session of the Intergovernmental Budget and Economic Council (IBEC), the Circular was the subject of discussion as well, with the Deputy President Kithure Kindiki who chairs the IBEC calling for dialogue berween the Council of Governors and the Controller of Budget for an amicable solution.
Following the IBEC meeting, a joint communique was issued in which the 3rd Respondent and the Council of Governors agreed to have all counties that have established distinct funds. continue to draw disbursements for Financial year 24/25 and advised any other county governments that have yet to establish distinct funds to expeditiously put such funds in place in order to continue issuing bursaries, or in the alternative to pursue Inter-Governmental Participatory Agreements with the Ministry of Education.
They told the court that unless the pplication is certified as urgent and the prayers sought granted, the Petition shall be rendered nugatory as the implementation of the IBEC-instigated agreement, which goes against the Circular, will effectively undermine the reliefs sought under Paragraphs 104 (A), (B) and (E) of this Petition.
The Petitioners’ prayers to halt the issuance of bursaries unless they are issued on the basis of a valid intergovernmental transfer agreement will be grossly undermined as the Respondents will now have another mongrel basis for the issuance of bursaries in the form of the IBEC-instigated agreement.
“The remedies issued at the judgment stage would be insufficient to address the harm done to the Constitutional framework for devolution, the right to education for affected learners, billions of taxpayers’ money that will have been misapplied and appropriated, as well as other county-level services that will either not be offered or offered ineffectively or at sub-optimal levels as any new bursaries issued will have to be implemented for the entire duration of the bursary post-judgment. This action will be irreversible,” said the lobby.
