Public participation in legislative process plays out in Finance Act appeal hearing

The issue of what should be considered sufficient and satisfactory public participation in a legislative process took centre stage during the hearing of the 2023 Finance Act appeal this week.

The principle is among the many issues Busia Senator Okiya Omtatah and others heavily submitted on as they persuaded the Supreme Court judges on why the Finance Act 2023 must fall.

Omtatah, Advocate Ochiel Dudley and Evans Ogada representing Siasa Place and Tribeless Youth urged the court to find that Parliament was obligated to give reasons for adopting or rejecting proposals received by members during the public participation process.

He said the clients they represent made 58 submissions and only four were considered. Two were marked as rejected and no reasons were given.

"When there are competing views you need to give reasons so that the public may know why it has been rejected or adopted," Dudley said.

They asked the Apex Judges to uphold the decision of the Court of Appeal delivered on July 31, which imposed a wide scope of public participation when it nullified the Finance Act, 2023.

Appellate Judges Kathurima M'inoti, Agnes Murgor and John Mativo said the various sections introduced post-public participation to amend the Income Tax Act, Value Added Tax Act, Excise Duty Act, Retirement Benefits Act and Export Processing Zones Act were unconstitutional as they were not subjected to fresh public participation.

The judges further stated that Parliament is obligated to provide reasons for adopting or rejecting any proposals received from members of the public during the public participation process.

"Failure to comply with this constitutional requirement renders the entire Finance Act 2023 unconstitutional," they said.

It is this finding that advocates both from the state and opposing sides belaboured on.

Even Chief Justice Martha Koome sought to find out from parties their views on the Court of Appeal's decision that appeared to have introduced new parameters on matters of public participation.

"It appears CoA raised the standard or changed the yardstick and introduced new parameters. Is that a breach of the requirements of public participation when it was not known or was it a new framework introduced to raise the bar?" Posed the CJ.

In response, Senior Counsel Kiragu Kimani and Prof Githu Muigai representing the Attorney General and CS Treasury said there is no requirement to give reasons for adoption or rejection.

Advocate Issa Mansour representing the National Assembly and its speaker on the other hand told the bench that the Court of Appeal deviated from the principles set in the British American tobacco case (BAT)which has served as a guiding standard on public participation.

In that case, BAT had challenged how the Tobacco control regulations came into place citing a lack of sufficient public participation. However, the Supreme Court found there was no unconstitutionality when the regulations came into force. The court ruled that while public participation must be genuine, it did not mean that all proposals and views presented during public participation must be accepted.

Mansour further stated that each amendment in the challenged Finance Act stemmed from the input received during public participation, reflecting a transparent and inclusive legislative process.

He said the CoA made a mistake in finding that amending the Finance Bill, 2023 public participation to include 18 new provisions from the public participation process was unconstitutional.

He said the decision by the appellate judges failed to appreciate the practical implications.

"Requiring every amendment to undergo public participation and additional readings (first, second and third reading) would bring the legislative process to a halt," he said.

Ochiel and Evans Ogada however, said the process remained unconstitutional since according to them, the new introductions were not submitted to public participation.

The appeal hearing filed by CS Treasury and AG started on Tuesday with the parties pleading with the court to overturn a decision that nullified the 2023 Finance Act.

Through Senior Counsel Prof Githu Muigai, Kiragu Kimani, Mahat Somane and Paul Nyamodi, the state argued that the decision of the Court of Appeal has hurt service delivery.

They highlighted in great detail the consequences of invalidating the Act.

Among them is default on debt for lack of adequate revenue, suspension of government projects and inability to pay officers including judges and members of independent commissions.

The counsels reiterated that the purpose of the government is to deliver services to its citizens but in the absence of legislation the same is inhibited.

They asked the Supreme Judges to consider crafting orders that would enable the state to continue delivering services to the public if they agreed with the decision of the appellate court that invalidated the Act.

Judgement will be delivered on notice.