Why transparency matters in projects
While many will agree that infrastructure projects are a necessary prerequisite for development, it is also not in doubt that they are very resource thirsty and pose a heavy burden to the taxpayer. The complexity and costs involved in developing a mega infrastructure project will inevitably have wide ramifications on a country’s economy. Take for example the debt risk which any government of the day must remain alive to, risk of failure by one of the parties to fulfil its side of the bargain under the contracts, or even the governance risk that comes with such contracts.
Citizens are especially concerned about ‘opaque’ transactions, which drive costs higher and affect public confidence in Government. With these mega developments being ‘public goods’ in every sense of the word and in light of their ramifications upon the citizenry, it follows that the public will inevitably be curious about their details and in particular about whether the deals concluded are fair, equitable, transparent and cost-effective. A citizen cannot make this assessment in the absence of the relevant information.
Many may not be aware that they are entitled to access information on government projects upon request, by virtue of Article 35 of the Constitution of Kenya 2010 and the Access to information Act which came into force in 2016 to give effect to Article 35. Based on the Constitution, the right to information can only be denied in limited scenarios such as where disclosure is likely to undermine national security of the country, where disclosure could impede the due process of law or where it endangers the safety, health or life of any person.
The above position was tested in the recent case of Khalifa & another v Secretary, National Treasury & Planning & 4 others; Katiba Institute & another (Interested Party) (Constitutional Petition 032 of 2019)  KEHC 368 (KLR) (13 May 2022), where the High Court of Kenya directed the government to disclose the details of the contract for the construction of the Standard Gauge Railway. The Petitioner had requested to access the documents, but his requests were ignored for almost 18 months. This prompted the Petitioner to file a constitutional petition seeking a raft of orders, including a declaration that the failure by the Respondents (PS, Ministry of Transport, Infrastructure Housing, Urban Development and Public Works, PS, National Treasury and Planning and the Attorney General) to provide the information sought violated constitutional provisions on access to information, transparency/openness and accountability.
The Respondents sought to rely on the Official Secrets Act, arguing that the contract contained non-disclosure clauses, disclosure would endanger state security, and that the information sought was privileged.
Upon considering the arguments of both sides, the High Court ruled that public officers have a constitutional duty to disclose information to Kenyans unless the limitation on access to information is warranted on grounds of protecting legitimate national interests. The court took the position that concerns around secrecy and state security could have been addressed by providing redacted documents to the Petitioner, with any clauses falling within the permissible exemptions being highlighted for determination by the court.
Applying this to mega projects generally, transparency can be helpful in ensuring integrity and competitiveness of the procurement process, winning public confidence in government, attracting foreign direct investment, among a host of other benefits. Most importantly, transparency helps fight corruption.
The Government has taken some positive steps in this regard. Case in point is the Companies (Beneficial Ownership Information) (Amendment) Regulations, 2022 which require parties to provide beneficial ownership information in public procurement, assets disposal and Public Private Partnership (PPP) arrangements.
The recently enacted Public Private Partnership Act, 2021 also calls for transparency by requiring contracting authorities to publish the results of tenders together with information on the nature of the projects, scope, successful bidder, project cost at net present value, project value, tariff and duration of the project. While the PPP Act does not require entire contracts to be published, the PPP Unit has already set up a section for uploading redacted contracts on its website.
Another positive development took place in 2018, when the president issued an executive order (No. 2 of 2018) requiring all Public Procuring Entities to maintain and continuously update and publicize information on the procurement of public goods, works and services, including information on all ongoing contracts entered prior to the date of coming into effect of the executive order.
These are all steps in the right direction towards achieving transparency. Even then, there is room for more to be done on the implementation front and it may take time for us to perfectly balance the principle of non-disclosure (to protect national interests) and transparency since non-disclosure seems antithetical to transparency. Fortunately, the ground-breaking decision of Khalifa & another v Secretary, National Treasury & Planning & 4 others which we have referred to above, provides a lot of direction.
All in all, the laws are in place and the court jurisprudence is supportive. Seeing as the transparency train has already left the station, the Government should now turn its focus on implementation by leveraging on technology, proper communication, reporting and other tools to achieve this noble goal.
The article was published in the Business Daily and can be accessed here.