Connect with us
Loading...

Business News

Okiya Omtata in court to protest repeal of interest cap ▷ Kenya News

Published

on


– Omtata said that Finance Bill 2019 was taken to the President for signing despite the fact that parliament did not raise the required quorum

– He says the Speaker deliberately pushed the bill through the house for assent while it was evident it had died since there were only 161 MPs present

– At least 233 majority MPs were required to be in the house for them to be able to veto Uhuru’s recommendations

– He wants the court to issue temporary orders to suspend the bill before determination of the case to prevent his petition from being overtaken by events

– The CBK had capped the rate at a maximum of 13% while its benchmark figure stood at 9%

– Last week, CBK lowered the benchmark rate from 9% to 8.5% which signalled an era for cheaper loans

Human rights activist Okiya Omtata has petitioned the court to suspend the recently signed Finance Bill 2019 terming the Act as unconstitutional.

In court papers, Omtata said President Uhuru Kenyatta’s reservation on the bill was not subjected to public participation adding that conditions under which the motion managed to sail through parliament did not meet merit.

According to the activist, MPs were unable to rise the 233 majority MPs that are required to veto the President’s directive. Only 161 legislators were present.

“The Finance Act 2019 is unconstitutional and therefore invalid, null and void ab initio because it was enacted in violation of a High Court decision,” said Omtata.

As earlier reported, the Finance Bill 2019 had been passed in Parliament and taken to the President for assent but the head of state returned it to the house prescribing clause 45 to be deleted.

The section was related to the capping of interests charged on loans by lenders, for instance, banks among other financial institutions.

According to Uhuru, the rate which had been capped by Central Bank of Kenya (CBK), was hurting the economy; sentiments that were later echoed by CBK Governor Patrick Njoroge.

“The year 2019 was a difficult year…maybe we have had other years before. However, first and foremost, the issue of interest rate cap affected us. We lost so much,” said Njoroge.

Uhuru said the cap had made banks to shy away from lending to Micro, Small and Medium Enterprises (MSMEs) thus leaving them at the mercy of exploitative shylocks.

National Assembly Speaker Justine Muturi, during the day of the vote, said the house had adopted the president’s recommendation which meant the 13% maximum cap had been scrapped off.

“The committee of the whole house has adopted the proposed amendments to the Finance Bill 2019, as per the President’s memorandum seeking to reverse the caps put on interest rates of bank loans,” National Assembly said in a tweet.

The activist, nonetheless, believes that the Speaker was wrong in passing the bill to the President since the absence of a quorum in the house meant the bill had died.

“The petitioner reasonably suspects that the speaker did so deliberately to avoid the possibility of the Bill being defeated or dying pursuant to article 221 (2) (b),” Omtata said.

A section of MPs who opposed the Bill expressed fear that it could result in the return of the era where banks exploited customers by charging them exorbitant rates.

However, after the cap was repealed, the Banker’s Association of Kenya said it will ensure the rates remained fair.

Governor Njoroge warned that the regulator will crack the whip on banks that will defy new lending directives.

On Monday, November 25, CBK revised the benchmark rate to 8.50% to 9 %; a move that is expected to see banks review their banks downwards.

Omtata, however, wants a temporary order to be given suspending the law between now and when the case will be determined to avoid his petition from being overtaken by events.

Do you have a groundbreaking story you would like us to publish? Please reach us through news@tuko.co.ke or WhatsApp: 0732482690. Contact Tuko.co.ke instantly.

I messed up so bad, I need a second chance in life – Boniface Ragalo | Tuko TV.

Subscribe to watch new videos

var FBInitEvent = new Event('fb:init');

document.dispatchEvent ? document.dispatchEvent(FBInitEvent) : console.warn('dispatchEvent is not supported')

window.FB.Event.subscribe('edge.create', function(response) { if (window.Site.fbLiked && (window.Site.fbLiked instanceof Function)) { window.Site.fbLiked(); } }); }; }

(function(d, s, id){ var js, fjs = d.getElementsByTagName(s)[0]; if (d.getElementById(id)) {return;} js = d.createElement(s); js.id = id; js.async = !0; js.src = "https://connect.facebook.net/en_US/sdk.js"; fjs.parentNode.insertBefore(js, fjs); }(document, 'script', 'facebook-jssdk'));



Source link

Advertisement
Loading...
Loading...

Facebook

Loading...

Trending

Social Media Auto Publish Powered By : XYZScripts.com