Controller of Budget moves to court as bursary disbursements stall over legal confusion

Controller of Budget Dr. Margaret Nyakang’o has filed an urgent application at the Nakuru High Court seeking clarity on contentious court orders that have thrown county bursary approvals and disbursements into disarray, delivering a major blow to needy students.

In her application, Dr. Nyakang’o says the orders, issued on February 3, 2025, both validate and restrict the implementation of Circular No. 1 of 2025—a directive from her office that outlines the legal process for counties to issue bursaries.

The circular requires, among other conditions, that bursary disbursements be supported by formal inter-governmental agreements.

The case arises from a constitutional petition by petitioners Laban Omusundi and Katiba Institute who have challenged aspects of county-level public finance management concerning education support programs. Respondents include the county governments of Nakuru and Murang’a, the National Treasury, the Senate, and the National Assembly.

Through a certification of urgency by legal officer Abigael Rasugu, Dr. Nyakang’o argues that an ex tempore court ruling delivered on April 8, 2025, clarified only some of the conservatory orders—specifically Orders 7 and 9—but left out crucial guidance on Orders 5, 6, and 8, leading to legal uncertainty.

Orders 5 and 6 restrained the CoB from withdrawing, retracting, or interfering with Circular No. 1 of 2025. These orders effectively upheld the continued validity and implementation of the circular, reinforcing its authority in guiding bursary disbursement by counties.

Order 7 introduced a restriction on the Controller’s role, directing her office not to authorise or approve any county bursary expenditures that are not accompanied by the necessary inter-governmental transfer agreements. This order placed a condition that appears to limit the application of the circular unless specific requirements are met.

Further Order 8 restrained the Controller from implementing any agreement reached with the Council of Governors during the 26th Intergovernmental Budget and Economic Council meeting, to the extent that such agreements conflict with the provisions of the circular or the reliefs sought in the petition.

At the same time, Order 9 directed that the Nakuru and Murang’a county governments should not issue new bursaries or bursaries to new beneficiaries that extend beyond the current financial year. This effectively limited how and when counties could allocate educational support funds to students.

According to Nyakang'o in her sworn affidavit, while Orders 5 and 6 uphold the validity of the circular, Orders 7 and 9 restrain her office from approving bursary requests unless they are supported by inter-governmental agreements and do not extend beyond the financial year.

“The selective clarification has created legal and operational uncertainty, potentially putting my office in a situation where any action or inaction could be viewed as contempt,” Dr. Nyakang’o stated.

She emphasised that no bursary approvals have been made since the orders were issued and that her application was made in good faith to ensure compliance with the law and prudent financial management.

Her application also comes in the wake of a separate legal move by the County Government of Murang’a, which filed for contempt proceedings against her over alleged failure to comply with the same court orders.