Several government infrastructure projects now face a fresh uncertainty after the High Court declared key provisions of the Public-Private Partnerships (PPP) Act unconstitutional.

🇰🇪 Breaking It Down

On Thursday, September 17, the court ruled that Parliament must oversee PPP arrangements that create financial obligations for the government, including expenditure that could affect taxpayers.

However, the ruling does not immediately stop ongoing PPP projects, as the court gave Parliament six months to amend the law before its declaration takes effect.

At the centre of the case are Sections 59, 60 and 72 of the PPP Act, which the petitioners challenged over the extent to which major PPP projects could be approved without Parliament's oversight.

📌 What You Need to Know

The case arose from the defunct privately initiated proposals involving the Jomo Kenyatta International Airport (JKIA) and Kenya Electricity Transmission Company (KETRACO).

In its defence, the government argued that cancelling the projects had brought the dispute to an end. However, the High Court rejected the argument, finding that broader constitutional questions surrounding PPP approvals remained relevant.

The court maintained that the government cannot use the PPP framework to bypass Parliament where an arrangement will ultimately create financial obligations for Kenyans.

Such obligations could arise when the government must pay private investors, issue guarantees, contribute public funds, borrow money or assume debts and other liabilities.

Nonetheless, the court clarified that not every PPP project requires parliamentary approval, with the key consideration being whether the arrangement creates a financial obligation for Kenyans.

Parliament now has six months to address the affected provisions before the declaration takes effect, setting the stage for possible changes to the way Kenya approves PPP projects.

📰 Source: Kenyans.co.ke