The Court of Appeal has overturned a High Court decision that had declared the National Government Constituencies Development Fund (NG-CDF) Act unconstitutional and ordered the suspension of the fund.
In a landmark judgment delivered Friday, February 6, the appellate court set aside the High Court ruling of 20 September 2024 and held that the NG-CDF Act of 2015 remains largely constitutional.
The judges ruled that the High Court erred in invalidating the entire statute, warning that such a drastic remedy was disproportionate and would have severely disrupted development projects funded by the NG-CDF across the country.
The Court of Appeal found that, contrary to the High Court’s earlier decision, the NG-CDF framework does not violate the principles of devolution, nor does it interfere with the constitutional division of functions between the national government and county governments as set out in the Constitution of Kenya.
According to the judges, the NG-CDF does not usurp county government functions and does not create a constitutional conflict between the two levels of government.
The court further held that the NG-CDF Act does not breach public finance management principles and added that Parliament was under no constitutional obligation to involve the Senate during the enactment of the legislation.
In a major relief for Parliament and the NG-CDF Board, the Court of Appeal ruled that the High Court’s remedy of nullifying the entire Act was excessive and failed to apply the principle of severability, which allows unconstitutional provisions to be removed without invalidating the whole law.
However, the appellate court identified a minor constitutional defect in the Act relating to the principle of separation of powers.
The court declared Section 43(9) of the NG-CDF Act unconstitutional to the extent that it ties the tenure of the Fund Account Manager to the term of Parliament and electoral cycles. That provision has now been formally struck out of the law.
The judges emphasized that, apart from this defect, the NGCDF Act of 2015 does not violate the doctrine of separation of powers.
The Court of Appeal also confirmed that the constitutional petition challenging the Act was not time-barred, despite amendments made to the law in 2022 and 2023.
Nevertheless, the court firmly rejected claims that the NG-CDF undermines devolution, duplicates county government functions, or violates safeguards governing public finances.
As a result of this ruling, the High Court orders that had nullified the entire NG-CDF Act and directed the suspension of the fund and its projects by 30 June 2026 have been set aside.
The decision means that the NG-CDF Act will continue to be implemented nationwide, with the sole exception of Section 43(9), which has been invalidated.
