MPs’ office complex project faces threat as budget cut looms

Kenyans are at risk of incurring heavy penalties for breach of contract as well as having the construction of a multi-billion-shilling office complex for MPs stall if a plan by the National Treasury to reduce Parliament’s budget sails through.

The Treasury is seeking to slash the development budget for government ministries, departments and constitutional commissions as well as independent offices to raise Sh52 billion in supplementary estimates currently under consideration in the National Assembly.

A special House committee,  chaired by Kipkelion East MP Joseph Limo, is considering the budget in a bid to finance the October 26 repeat presidential election that is expected to cost Sh12 billion, and also raise Sh23 billion for free secondary education expected to start in January next year.

The lawmakers are expected to debate the committee’s report soon, when the House resumes its business after a short recess.

WORST HIT

The worst hit institutions in the revised estimates are Parliament, which will have to make do with a 25 per cent reduction in its budget, followed by the Judiciary, whose budget has been slashed by 12.5 per cent.

The Executive will, however, get a 1.4 per cent increase.

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On Thursday, Parliamentary Service Commission(PSC) secretary Jeremiah Nyegenye, who is also the Senate clerk, and National Assembly clerk Michael Sialai protested and told the special committee that the Sh9.2 billion reduction would greatly affect the operations of Parliament.

If the MPs reduce their own budget, the construction of the Sh5 billion multi-storey building, launched in January 2014 by National Assembly Speaker Justin Muturi, will be the most affected, according to the two clerks.

BREACH OF CONTRACT

“If the supplementary estimates are passed as proposed, the Parliamentary Service Commission shall have no option but to fall into breach of contract for non-payment of sums due to the contractor and shall furthermore have to ask the contractor to stop any further works until adequate budgetary provision is made for the project,” Mr Nyegenye told the committee.

Mr Sialai noted that Parliament had committed itself to legal and contractual obligations with China Jiangxi International Ltd, which is constructing the building.

“A stoppage at this time will affect the project completion period, bring about additional costs (contract sum variations) due to stoppage and may also have consequences on the bilateral relations between Kenya and other countries,” said Mr Sialai.

“The PSC takes cognisance of the fact that the National Treasury must maintain a fiscal framework that is affordable within the revenue generated in the country. However, this should not curtail the legislative and other business of Parliament,” he said.

ALLOCATION

In the current financial year, Parliament was allocated Sh36 billion, down from the Sh42 billion it sought, after consultations with the National Treasury.

The Treasury seeks to reduce this budget by Sh9.2 billion, a move that has been faulted and described by Mr Sialai as unilateral.

“What we have is a negotiated budget between the Treasury and the Budget and Appropriations Committee of the National Assembly. The tradition has been that the Treasury does not cut a budget arrived at with Parliament. We don’t increase our budget without consulting the Treasury and neither can they cut our budget,” said Mr Sialai.

In the 2017/2018 budget, Sh2.4 billion was set aside for the completion of the building, Parliament’s flagship project.

SCALE DOWN

However, in its bid to scale down the development budgets of various government agencies, the Treasury cut the figure to Sh500 million, which Mr Nyegenye said is not even enough to cover the Sh617 million in pending bills for the project.

“This shall exacerbate the current shortage of suitable office accommodation for MPs and generally hamper the provision of such services and facilities to MPs as required for the effective and efficient functioning of Parliament,” Mr Nyegenye told the ad hoc committee.

Mr Nyegenye also noted that the PSC currently rents offices within the parliamentary square, particularly at the Kenyatta International Convention Centre, Harambee Plaza, Ukulima House and Imani House for MPs.

He said the reduction of estimates for rent shall severely hamper the PSC’s ability to pay rent and, therefore, lead to breach of the commission’s contractual obligations and may see the eviction of MPs from their offices.

OPERATE

“We are wondering how we will operate considering that we are in the first quarter of the financial year. We may close and go home. We are comfortable with a zero reduction,” he said.

Of the Sh36 billion appropriated, the National Assembly got Sh21.2 billion to fund its operations. However, the Treasury seeks to cut the budget to Sh17.5 billion.

Hardest hit under the National Assembly include domestic travel, which has been reduced from Sh3.4 billion to Sh2.7 billion; foreign travel, from Sh1.6 billion to Sh389.3 million; and advertising and other services from Sh178.9 million to Sh45.5 million.

Others include capacity building for MPs, from Sh111.7 million to Sh83 million; purchase of vehicles for the National Assembly leadership and other transport, from Sh120 million to Sh30 million; office furniture for MPs, from Sh205 million to Sh51.3 million; hospitality services, from Sh322.8 million to Sh80 million; and maintenance, from Sh45 million to Sh11 million.