Lobby in court to challenge Ruto pet project

The Kenya Kwanza’s government’s pet project, the Hustler Fund, was yesterday placed in focus after a lobby group moved to court to challenge its constitutionality.

Operation Linda Ugatuzi argues the Sh50 billion fund was launched without the constitution of an advisory board.

The lobby wants the court to suspend any further disbursements of the funds arguing that there has not been any establishment of a board contemplated under Regulation 10 of the regulation by the Treasury cabinet secretary.

The lobby group through lawyer Benard Odero Okello however claims the cabinet secretary has not appointed a Chief Executive Officer under regulation 14(1) nor approved the estimates of expenditure and revenue.

“Despite the said fund being stated to have been removed from the consolidated fund without following the due process enshrined in the law, the president has indicated that a further role out of the second phase of the fund is to be released to the public soon,” Okello states in court documents.

He avers that a public fund of over Sh100 billion will be unaccounted for out of the Consolidated Fund for lack of proper administrative mechanisms to safeguard the same as required under the constitution and the public finance management act as read together with the regulations establishing the fund.

The caucus argues that to-date, there has not been any appropriation by the National Assembly as per Regulations 4, 5 and 6 of the regulations.

“Unless this court issues orders of stay against further role out of the Financial Inclusion Fund pending hearing and determination of this application, the legislations enacted pursuant to the constitutional provisions on public finance stand to be violated irreparably to the detriment of the current citizens of the Republic of Kenya and future generations,” claims Okello in court documents.

It wants the court to order the government to provide information about the source of the funds that have been currently disbursed under the financial inclusion fund.

Petitioners want the court to issue an order freezing penalty and or negative repercussions being visited upon any citizen that has already borrowed and or withdrawn money from the Hustler Fund platform.

They seek to suspend the legal notice and also a declaration that the president acted ultra vires by launching the role out of the fund without constitution of the advisory board as established under regulation 10.

In addition, they want the court to compel the Controller of Budget to reveal the source of the funds and account for all the money that has been disbursed.

Abuse of office

The lobby maintains that the continued rollout of the fund as current stands is an abuse of office and violation of constitutional principles of public finance and leadership and integrity principles under the constitution of Kenya.

They have enjoined Central Bank of Kenya, Safaricom PLC, Kenya Commercial Bank, Airtel Kenya, National Security Funds, Retirement Benefit Authority as interested Parties in the suit while the Attorney General has been named as the respondent. The lawsuit comes a day after Azimio la Umoja leaders called on Kenyans not to repay the loans disbursed to them under the fund as it was not anchored in law.

Addressing a rally at the Kamukunji grounds in Nairobi on Wednesday, Opposition Chief Raila Odinga, accompanied by Wiper leader Kalonzo Musyoka and his Narc Kenya counterpart, Martha Karua, said the loans being disbursed to Kenyans under the Hustler Fund was inadequate to support any meaningful business venture that will enable borrowers to repay within 14 days.

“We had promised Kenyan households who are at the lower cadre that we were to disburse Sh6,000 per month. In the Hustler Fund, you are given Sh500 to start a business. Is it really adequate to start any meaningful business?” asked Raila.

He spoke at the first of a series of rallies he has called to put the Ruto administration in check.

Kalonzo also weighed in, saying that the money allocated for the loan had not been appropriated by Parliament, and, therefore, nobody should be penalised for failing to refund any amount borrowed.