PS pick faults Judiciary on Sh9bn housing fund


Housing Principal Secretary nominee Charles Hinga. NMG PHOTO

The Judiciary has been blamed for the collapse of a government plan to make a 1.5 percent salary deduction and raise Sh9 billion annually for financing construction of cheap houses.

Housing Principal Secretary nominee Charles Hinga accused the Judiciary of failing to render a ruling despite stopping the government from implementing the levy four years ago.

He told the National Assembly’s vetting panel that the courts were used by 11 individuals to stop the government plan to raise funds for construction of 500,000 housing units annually. The 1.5 percent levy was stopped when the government had collected Sh2 billion, the nominee said.

The Employment and Labour Relations Court in 2018 suspended the levy following a petition from the workers' umbrella body, the Central Organisation of Trade Unions (Cotu) in December. The courts suspended the levy on grounds that no public participation was undertaken and that transparency in its implementation was not guaranteed.

The deduction was contained in the Finance Act, 2018 which was set to take effect on January 1, 2019 despite opposition from unions and employers. “The mandatory contribution where an employer was to pay 1.5 percent and employee 1.5 percent monthly was tragically stopped by 11 people,” Mr Hinga told MPs.

“Unfortunately, the courts have never ruled in those cases filed separately at the Employment and Labour Relations Court, the Environment and Land Court and Constitutional Review Court. The intention was purely to sabotage the roll-out of the Housing Fund.”

Mr Hinga told the Housing and Urban Planning committee that the frustration that the fund faced in court through postponement of hearings forced former President Uhuru Kenyatta to lose interest and directed the levy be voluntary.

“We were forced to go out of mandatory contribution to voluntary contributory levy. The former President got tired with the court cases. Certain groups, including the Judiciary, were frustrating us,” Mr Hinga said.

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