Cord leader Raila Odinga has criticised President Uhuru Kenyatta for declining to assent to the Petroleum (Exploration, Development and Production) Bill 2015, which would have given local communities 10 per cent of oil revenues derived from their areas.
In a memorandum to Parliament last month, the President instead proposed that the share of revenues be reduced to five per cent.
In addition, while the President retained the allocation of 20 per cent of oil revenues due to a county government in whose region oil is being explored and exploited, he added a rider that it should not exceed twice the amount it has been allocated by Parliament in a financial year.
“Unless the shares of the petroleum revenues reserved to county governments are capped, the implementation of the (percentages set by Parliament) shall pose the challenge of the inequitable distribution of resources and the risk that county governments and local communities shall receive disproportionately higher allocations which might be beyond their absorption capacities,” said President Uhuru in his memorandum, which was submitted to Parliament.
President Uhuru had declined to assent to the Bill on September 23. Also rejected was the Energy Bill, which had sought to compel Kenya Power to compensate victims of power outages, saying it was broad and needed to be narrowed to a dispute between the utility company and a consumer.
On the Petroleum Bill, Raila says the President’s decision will deny the Turkana county government and local residents an adequate share of revenue accrued from natural resources found there.
He said oil has been discovered in areas which have been marginalised for many years and the Bill ought to be returned to the President as it is for assent.
“In rejecting the Bill, the President proposed drastic changes to the benefits and sharing formula that had been proposed by Parliament. One of the amendments the President wants is to reduce the amount due to host communities from 10 per cent to 5 per cent. The President also wants to reduce the share of County Government from 20 per cent to an ambiguous figure to be determined by the National Government purportedly to cater for what he calls “equitable share of taxes”, whatever that means,” he said.
“With that demand on “equitable share of taxes”, the President is attempting to place the entitlements of the host communities and the County Governments at the mercy of the executive arm of the National Government. This is a clear violation of the Constitution and an attempt to reintroduce marginalisation of communities in regard to their resources through the back door, added the ODM leader.
He was speaking at his Capital Hill offices where he was flanked by ODM Deputy Leader Hassan Joho, Nairobi Governor Evans Kidero, Turkana Governor Josephat Nanok, Siaya Governor Cornel Rasanga, Busia Women Representative Florence Mutua-Waingah , Kitutu Masaba MP and ODM Treasurer Timothy Bosire and ODM Executive Director Oduor Ongwen.
MPs from Turkana County, where Tullow Oil is preparing to commence oil exports next year, had lobbied for a higher share in order to ensure that local communities adequately benefit from the natural resource.
“The rejection of the Bill by the President is a slap on the face of communities that had finally seen a realistic chance to pull themselves from the dehumanisation of years of State-sanctioned marginalisation and poverty to which the past constitutional order had condemned them,” said Raila.
“All communities are entitled to grow and benefit from their God-given resources be they fertile land, forests, minerals or, as the case of Turkana, oil. Every part of this country has its own resources that they can or have developed over the years for the benefits of residents and the entire nation. We have regions that have done well in agriculture and fully enjoyed its proceeds,” he added.
While MPs – both in the Senate and the National Assembly – opposed to the memorandum can overturn the President’s memorandum they would have to garner a two-thirds majority, which has never happened before in the Jubilee-dominated Parliament.
In his memorandum, President Uhuru, however, sought to strengthen the role of MPs over agreements and contracts.
The Bill had handed powers to the Energy and Petroleum Cabinet Secretary to execute a contract even where there are no bid.
Also the Bill provided that the CS submit to Parliament production sharing contracts for ratification in accordance with Article 71 of the Constitution but the President also said it would be important for MPs to also scrutinise the field development plan.