- The president said on Wednesday that he had listened to concerns by Kenyans and conceded, saying he would seek the National Assembly’s total withdrawal of the Bill.
- The House will have 21 days to process the President’s recommendations and pass a resolution, in this case, approve the committee’s proposal to delete the Bill.
MPs must deliberately vote to deny the house a two-thirds majority required to override a presidential memorandum for the Finance Bill, 2024 to be formally withdrawn.
President William Ruto made a surprise U-turn on Wednesday.
He rejected the Finance Bill, 2024 in totality, referring it back to the National Assembly with a recommendation to delete all the clauses.
The Finance Bill is a short title of the proposed legislation to amend the law relating to various taxes and duties proposed by the government for a specific financial year.
The president's decision to reject the Finance Bill, 2024 in its totality triggered a debate about the next stages of its formal withdrawal from the House given it had already been passed.
It has now emerged that the Bill, which is required by law to have been passed by June 30 for it to take effect for the next financial year, will fall on the floor for Ruto's recommendations to take effect.
MPs who voted yes for the Bill will now have to join hands with those who opposed it on the floor of the House in a technical balance to occasion its death.
Defense Cabinet Secretary Aden Duale who served for nearly 10 years as National Assembly Majority Leader confirmed that the President's reservations will be processed the usual way presidential referrals of bills are done.
"To overturn the President's deletion of all clauses, the National Assembly would need to garner two-thirds of all its members," Duale said.
The Magic Two-thirds
The former Garissa Township MP, who is well versed with legislative protocols and procedures, said it would be a tall order for MPs to muster the 233 required to overturn Ruto's rejection.
He said given the unanimous decision by Kenya Kwanza MPs who accompanied Ruto "to honour the voice of the people of Kenya" on Wednesday, the presidential memorandum will fall on the floor.
"With this, the Bill fails and that shall be the end of its legislative process," Duale said.
Duale said that after the Bill falls and noting the law requires such a Bill to have been passed by 30th June 2024, the government will proceed with the revenue-raising measures for the 2023/24 financial year.
Ruto said Wednesday that he will not sign the controversial finance bill, backing down in the face of mass protests that swept the country.
“Having reflected on the continuing conversation regarding the content of the Finance Bill 2024, and listening keenly to the people of Kenya who have said loudly that they want nothing to do with this Finance Bill 2024, I concede, and therefore I will not sign the 2024 finance bill,” Ruto said.
“The people have spoken,” Ruto said. “Following the passage of the bill, the country experienced widespread expression of dissatisfaction with the bill as passed, regrettably resulting in the loss of life, the destruction of property and desecration of constitutional institutions.”
Late on Wednesday night, the president signed the presidential instrument to refer the Bill back to parliament citing widespread expressions of disaffection by Kenyans.
"Now therefore, in exercise of the powers conferred to me by Article 115(1)(b) of the Constitution and having reservations on the contents of the Bill in its entirety, I decline to assent to the Finance Bill, 2024, and refer the Bill for reconsideration by the National Assembly with the recommendation for the deletion of all the clauses thereof,'' Ruto said in his presidential memorandum of referral.
According to the Constitution, Ruto had only two options on the Finance Bill, 2024: Assent or refer to Parliament.
The law provides that if the President does not assent to a Bill or refer it back within 14 days of receipt from Parliament, it shall be taken to have been assented to on the expiry of that period.
The Standing Orders provide the procedure for how the presidential referral is processed.
Standing Order 154(1)(a) provides that once the speaker receives the memorandum of referral from the President, he will communicate to members within three days.
21-day Requirement
The House shall then consider the president’s reservations within twenty-one days of the date when the House next meets.
The National Assembly proceeded for a short recess from June 26 until July 23 after passing the Finance Bill, 2024 on Tuesday and approving the deployment of the Kenya Defence Forces on Wednesday.
This means that there may be no urgency for MPs to be summoned from recess and will consider the memorandum 21 days after they resume on July 23.
However, this will not affect operations of government because the current Finance Act of 2023 will kick in and continue to operate from July 1 once the Finance Bill, 2024 is not assented to by June 30.
Former Ndaragwa MP and Jubilee Secretary General Jeremiah Kioni said the president’s rejection must be commuted to the House for withdrawal in accordance to the Standing Orders.
The ex-lawmaker said that a Bill that had already been debated in the House cannot be withdrawn anyhow, saying the National Assembly must now convene ''urgently.''
“He(Ruto) must send it back to parliament with a memorandum of withdrawal, failure to which the bill becomes law after 21 days even if he doesn’t assent to it. Let parliament convene for a special sitting and officially withdraw it,’’ he said.
Constitutional lawyer and Rarienda MP Otiende Amollo laughed off the President’s withdrawal saying the Constitution presupposes that the Bill will become law if not assented to within 14 days.
“Ati Withdrawn & Sent Back To Parliament?! Read For Yourselves The Simple & Clear Wording Of Article 115," Otiende wrote on his X account.
Former Kitutu Masaba MP Timothy Bosire said the country had been thrown into uncharted waters following Ruto’s rejection of the Finance Bill.
“The next stages will be determined by the president’s notes to the Bill. The Bill can only be withdrawn by the House upon a resolution. This is very rare and must be handled with utmost thoroughness," he said.
However, the Constitution and the Standing Orders provide for presidential referrals of various legislative pieces although the latest on the financial bill is unique.
Previously, presidents have returned bills to parliament proposing amendments but never sent notes for total rejection of the proposed laws, especially the finance bills.
The constitution provides that when referring a bill back to parliament, the President shall note any reservations he has concerning the Bill, in this case, the deletion of clauses.
Parliament shall then amend the bill in light of the president’s reservations or pass it without amendment.
“If parliament amends the Bill fully accommodating the President’s reservations, the appropriate speaker shall re-submit it to the president for assent,’’ reads Article 115(3).
No to Assent
In this case, the president will not need to sign into law the Finance Bill, 2024 because the current one which is already assented to will continue being in operation without the additional tax measures.
The government was seeking to raise nearly Sh200 billion from the various tax proposals contained in the controversial Finance Bill, 2024.
This means that without the bill, the government will have to find ways to bridge the budget deficit by either cutting down on expenditure or borrowing to finance its Sh3.99 trillion budget.
Ruto on Wednesday said he may not be keen on borrowing after he hinted at radical budget cuts to rationalise the budget with the Sh200 billion budget shortfall.
“In the Presidency and Office of the Presidency, we will reduce the confidential vote, travel budget, hospitality, purchase of motor vehicles, renovations, and other expenditures,” Ruto said.
The Head of State noted that various pending development projects would face setbacks due to the budget cuts, given the calls by Kenyans for a ‘leaner’ budget during these harsh economic times.
“Without the Finance Bill, it means some of the development programs amounting to Sh200 billion will have to be cut, delayed until next year, or cancelled because Kenyans have said they want a leaner budget,” President Ruto said.