Parliament has summoned Prime Cabinet Secretary Musalia Mudavadi , Treasury Cabinet member John Mbadi , and Investment counterpart Lee Kinyanjui over the controversial payment of Sh1 billion for Kenya's membership to the Abuja-based African Finance Corporation (AFC) without the approval of lawmakers.
Also summoned to appear before the National Assembly's Finance and National Planning Committee tomorrow (Tuesday) are Attorney-General Dorcas Odour and Solicitor-General Shadrack Mose.
The Solicitor General Shadrack J. Mose.
Photo credit: Dennis Onsongo | Nation Media Group
They are required to shed light on how Kenya paid Sh1 billion in 2023/24 for membership to the Abuja–based African Finance Corporation (AFC) without the approval of MPs.
Kenya paid the money to the AFC without Parliament ratifying the Accession of the Agreement for the Establishment of the Africa Finance Corporation (AFC).
The Cabinet in 2017 approved Kenya’s Accession of the Agreement for The Establishment of the African Finance Corporation.
Mr Mudavadi is now asking the National Assembly to ratify the agreement, eight years down the line.
Kenya is already a member of the Abuja–based African Finance Corporation (AFC) without the approval of Parliament.
The agreement states that the Accession will not attract any new financial requirements as the implementation of the agreement only necessitates membership to the corporation and not shareholding.
Section 8 of the Treaty Making and Ratification Act of 2012 which governs the process of making and ratifying treaties, requires that where the Cabinet approves the ratification of a treaty, the Cabinet Secretary shall submit the treaty and a memorandum on the treaty to the Speaker of the National Assembly.
The Attorney General Dorcas Oduor.
Photo credit: Dennis Onsongo | Nation Media Group
"The relevant parliamentary committee shall, during its consideration of the Treaty, ensure public participation in the ratification process in accordance with laid down parliamentary procedures," the Act states.
"Parliament may approve the ratification of a treaty with or without reservations to specific provisions of the treaty."
Mr Mudavadi, who is also the Cabinet Secretary for Foreign and Diaspora Affairs, is expected to be interrogated on how he signed the Accession of the Agreement for the Establishment of the Africa Finance Corporation (AFC) on October 28, 2024, using a Cabinet Resolution signed by former Treasury Cabinet Secretary Henry Rotich on April 4, 2017, and which was not tabled in Parliament for ratification as required by the law.
Mr Mbadi and Mr Kinyanjui will face questions as to how Sh1 billion was released for payment of Kenya's membership to the AFC without Parliament ratifying Kenya’s Accession of the Agreement for the Establishment of the Africa Finance Corporation.
The Attorney General and the Solicitor-General are expected to explain whether they perused the contents of the agreement and approved its signing.
John Mbadi the Cabinet Secretary for National Treasury and Economic Planning.
Photo credit: File | Nation Media Group
The AFC, an affiliate of the African Development Bank (AfDB), seeks to allow member States to access significant finances for large-scale infrastructure projects.
“This could alleviate some of the financial pressure on the national budget and help accelerate Kenya’s development agenda, particularly under Vision 2030,” the document signed by Mr Mudavadi states.
“Infrastructure development is key to economic growth. With better roads, energy and communication networks, Kenya could attract more foreign direct investment, improve trade and create jobs, ultimately improving living standards.”
Mr Mudavadi said the corporation has a high credit rating and a solid governance framework which helps mitigate investment risks for infrastructure projects.
“This means Kenya could see more foreign investors willing to participate in projects that could see more foreign investors willing to participate in projects,” he said in the document to Parliament.
“The corporation facilitates the development of regional infrastructure projects, such as cross-border transportation corridors and energy sharing networks.”
The committee chaired by Molo MP Kuria Kimani is scrutinising the agreement to ensure that it aligns with the provisions of the Treaty Making Ratification Act, 2012.
On Thursday, February 20, committee members Joseph Makilap (Baringo North), Ariko Amoit (Turkana South) and David Mboni (Kitui Rural) demanded to know if the Controller of Budget Margaret Nyakango approved the Sh1 billion payment for Kenya’s membership to the AFC.
Mr Makilap asked Ms Nyakang’o to explain whether there are more funds paid to the AFC without the approval of Parliament.
“Requisitions from the National Treasury are not transparent. We are getting to know that Sh1 billion was paid. The requests come in batches and are not specific in detail.”
“It (requisitions) come as a combined batch from the National Treasury. They don’t give details of where the funds are going. The Sh1 billion for AFC may have come as a batch with others. I can’t know where the money was to be directed because I only approve withdrawals from the Consolidated Fund and not payments to respective entities by State agencies.”
Ms Nyakango told the committee that she approves 115 files from the National Treasury for withdrawals from the Consolidated Fund weekly.
