Constituencies Development Fund Act

This Act may be cited as the Constituencies Development Fund Act.

Section 2 provides definitions of terms used in the Act.

The Act requires that a specific portion of the national annual budget be devoted to constituencies for infrastructural development, wealth creation and fighting poverty at the constituency level.

The Cabinet Secretary, with the concurrence of the relevant Parliamentary Committee, must allocate funds to each constituency each financial year in accordance with section 20.

Receipts, savings, accruals and the Fund balance at each financial year-end must be returned to the Fund and applied per section 10(5); funds allocated to a constituency are cumulative and carried forward to the next financial year, including amounts returned under section 10(3) or unutilized funds.

The Constituency Development Fund Committee must determine allocation of the emergency reserve; the Project Management Committee must set aside five per centum of each project's allocation for administration; "Emergency" is defined as an urgent, unforeseen expenditure need that cannot be delayed without harming public interest.

Establishes the Constituencies Development Fund, requires it include at least 2.5% of national government ordinary revenue each financial year, allows other moneys received by the Board to form part of the Fund, requires disbursement by the national government through the Board to constituencies as grants, and requires administration by the Board.

Creates the Constituencies Development Fund Board, lists its membership, gives the Board corporate powers, requires the Cabinet Secretary to appoint the Chairperson, and requires the Board to appoint a corporation secretary.

The Board must perform a set of functions to manage and disburse the Constituencies Development Fund, including disbursing funds, managing the Fund, receiving reports, compiling records, handling complaints, approving and funding projects, and other duties.

The Board's conduct and regulation of its business and affairs must follow the Fourth Schedule; except as provided there, the Board may regulate its own procedure.

The Board must recruit a Chief Executive Officer competitively and recommend appointment to the Cabinet Secretary with Parliamentary Committee approval; the CEO must meet specified qualifications and manage day-to-day Board affairs and staff, serving a renewable five-year term.

The Board must approve and minute every disbursement from the Fund; the Board must set out conditions for release of funds; the Board may impose requirements or restrictions on constituencies.

The chairman of the Constituency Development Fund Committee must submit the approved list of proposed constituency projects to the Board; the Board must compile and submit that list to the Parliamentary Committee for approval.

Lists of proposed constituency projects must be submitted to the Board before the end of February each year, or in another month if the Cabinet Secretary determines one; if the chairman of the Constituency Development Fund Committee fails to submit on time, the list is deemed submitted when the stipulated time lapses.

Project lists must be submitted on the Constituency Projects Submission Form set out in the First Schedule and accompanied by CDF Committee minutes; all proposed projects for each constituency must be listed with cost estimates, amounts allocated and amounts disbursed.

For every project listed in the Form, a Project Description Form set out in the Second Schedule must be attached.

The Board must scrutinize and approve for funding project proposals that are consistent with the Act; if it does not approve a proposal it must refer the matter to the Constituencies Development Fund Committee and give reasons.

The Constituency Development Fund Committee is responsible for allocating funds to projects in each constituency and may exercise that responsibility at its own discretion within this Act.

Projects listed for each constituency must be numbered by the Board, and serial numbers must bear the constituency's number so a project keeps the same serial number every year until completion.

Sets how constituency budget ceilings are calculated (three quarters of the amount in section 4(1) divided equally; one quarter adjusted by poverty indices) and requires the Cabinet Secretary to determine and submit ceilings to Parliament in consultation with the Committee; the Committee Chair must table a schedule; provision commenced with 2013/2014 allocations.

The Constituency Development Fund Committee must ensure project lists comply with the Act and that total project costs do not exceed (or fall below) the allowable constituency ceiling.

Projects under this Act must be community based; funding may cover complete projects or defined phases and may include land/building acquisition; funds must not support political or religious activities except limited emergency identification by the Committee; specified percentage caps apply to administration (6%), sports (2%), monitoring and evaluation (3%), and environmental activities (2%).

Each constituency must include between five and twenty-five projects in the Constituency Projects Submission Form in every financial year.

Rules on composition, appointment, meetings, terms, vacancies and removals for Constituency Development Fund Committees, including publication of members by the Cabinet Secretary and meeting frequency requirements.

Section 25(1) permits the Constituency Development Fund Committee to consult relevant Government departments to make project cost estimates realistic; Section 25(2) requires the Committee to rank projects by priority and, if total costs exceed the constituency ceiling, use that ranking for fund allocation while giving ongoing projects precedence.

Projects that involve personal awards in cash or in kind are excluded from the list of projects submitted under section 13; however, education bursary schemes, mocks and continuous assessment tests are considered development projects but must not be allocated more than 25% of the constituency's total funds in any financial year.

The Board may consider part funding of a project financed from sources other than the Fund, provided the other financiers or donors have no objection.

Section 45 sets rules on Board finances, including that government pays personal emoluments from recurrent expenditure and the Cabinet Secretary determines other emoluments from the Fund.

The Cabinet Secretary may make regulations for the Fund (subject to National Assembly approval) and may amend Schedules by Gazette notice (also subject to National Assembly approval).

The Act's provisions are complementary to other national, county or agency development efforts, do not exclude areas from other development programmes, and normal government development allocations will continue alongside projects funded under the Act.

Anyone who misappropriates funds or assets from the Fund, or assists or causes such misappropriation, commits an offence and on conviction faces at least five years' imprisonment or at least a KSh 500,000 fine, or both.

Complaints and disputes under the Act must be forwarded to the Board first; criminal complaints the Board must forward to prosecutorial agencies; civil disputes may go to arbitration (panel appointed by parties by consensus; if they cannot agree the Cabinet Secretary may appoint an arbitrator) with costs borne by the parties; Fund managers are not personally liable for lawful official actions.

The Constituencies Development Fund Act, 2003 is repealed.

On commencement day, the assets, funds, rights, powers and liabilities held by the former Board transfer to the Board; the former Board's annual estimates are deemed the Board's for the rest of that financial year; members and the CEO of the former Board continue in office until their terms expire.

The National Assembly must establish a Select Committee (a Chairperson and up to eighteen other members) and ensure proportionate party representation; the Committee must perform oversight, reporting every two years on the Act, and other defined functions.

Quarterly reports must include a summary of project proposals received from constituencies in the preceding month and indicate the approval status of those projects.

The Board must ensure that constituency-approved project lists are funded under the Act.

Project management committees must implement projects; the Constituency Development Fund Committee and the Board must monitor projects, may designate monitoring sub-committees, and must submit reports; equipment purchased for a constituency is for that constituency's exclusive use; assets bought under the Act are property of the Board and to be insured in its name.

All works and services for projects under this Act must be procured in accordance with the Public Procurement and Asset Disposal Act (Cap. 412C).

A record of receipts and disbursement must be tabled at a meeting of the Constituency Development Fund Committee every month.

The Auditor-General must audit and report on all funds received under this Act.

Community-initiated projects are eligible for support if submitted with other projects and conform to the Act; a community must maintain an elected committee to represent it during and after project implementation and that committee must conform with the Act's requirements.

A County Projects Committee is established for every county to coordinate Fund-financed projects; the County Projects Committee may visit projects, officially or impromptu, in the discharge of its functions.

Defines membership and operating rules for County Projects Committee: lists members, allows departmental heads to attend as ex officio, requires election of a chairperson for a three-year term (subject to regulations), sets quorum at one half, requires meetings at county headquarters 2–4 times per year, continuation rules around elections, constitution of new committees within sixty days after Parliament is inaugurated, and Board allocation of administrative funds.

The Chairperson of the Constituency Development Fund Committee for each constituency must table a list of that constituency's projects at a County Projects Committee meeting convened for that purpose.

The County Projects Committee must ensure projects are not duplicated and should combine efforts when prudent across constituencies.

The County Projects Committee must, at the beginning of every financial year, prepare and circulate to the county Constituency Development Fund Committees a list of other government allocations for projects in the county.

The Board must appoint the officers and staff needed to manage the Fund and discharge its functions; it may determine their terms and conditions; and the Board must establish or vary its principal management structure with the approval of the Cabinet Secretary.

Each constituency must maintain only one constituency account; the Fund account manager may incur expenditure from that account; the Cabinet Secretary approves which commercial banks may hold constituency accounts; unutilized funds of a Project Management Committee must be returned to the constituency account.

The Fund's account must have specified signatories: the Chief Executive Officer and three Board-appointed members; the CEO's signature is mandatory on payments plus any two of the other three signatories.

The Board must keep and update a monthly record of constituency project disbursements; the Chairperson must submit an annual report; and the Board must submit separate constituency and Board accounts to the Auditor‑General at the end of each financial year.