The Court of Appeal has overturned a High Court decision that had declared the NG-CDF unconstitutional, ruling that the fund does not violate the constitutional division of functions under devolution.
The court also held that ammedments on the National Government Constituencies Development Fund Act did not require Senate participation.
In a judgment delivered on Friday, February 6, a three-judge bench led by Court of Appeal President Daniel Musinga, alongside Justices Francis Tuiyott and Isaac Muchelele, held that the NG-CDF Act is consistent with the Constitution and does not undermine county governments.
The ruling reverses a September 2024 High Court decision which had found that the Fund created an unlawful third tier of government and duplicated county functions, ordering its operations to cease by June 30, 2026.
In setting aside the High Court ruling, the appellate judges held that constituencies are not units of government but administrative platforms through which the national government delivers certain services.
They found that projects funded under NG-CDF — including education support, bursaries and security-related infrastructure — fall within national government functions as provided under the Fourth Schedule of the Constitution.
“The NG-CDF Act does not transfer devolved functions to the national government nor does it confer executive authority upon Members of Parliament,” the court ruled.
The judges further noted that the Fund is financed from the national government’s share of revenue after allocation to counties, and therefore does not infringe on county resources or functions.
Senate role not required
The appellate court also settled a long-standing dispute over the legislative process, ruling that Senate involvement was not mandatory when Parliament enacted the NG-CDF law.
The judges held that the Act does not concern county governments within the meaning of Article 110 of the Constitution, as it neither alters county functions nor affects revenue allocation to counties.
They concluded that the law properly fell within the legislative mandate of the National Assembly.
However, the court struck down Section 43(9) of the Act, which tied the tenure of the NG-CDF Fund Account Manager to the life of Parliament.
The judges declared the provision unconstitutional for violating the principle of separation of powers, saying the office must remain independent of political timelines.
“The position must be insulated from political tenure,” the bench held.
Applying the doctrine of severability, the court removed the offending clause while preserving the rest of the Act.
The ruling clears the way for continued disbursement of billions of shillings annually to constituencies for projects such as classrooms, bursaries and local security facilities.
The judges directed each party to bear its own costs, citing the public interest nature of the case.
The decision is a significant boost for the NG-CDF and sets the stage for its continued operation unless successfully challenged at the Supreme Court.