Kenyan lawmakers criticise Ndung’u reappointment

Kenyan lawmakers have challenged the reappointment of Njuguna Ndung'u, the governor of the Central Bank of Kenya, local media sources have reported.

Daily Nation, a Kenyan newspaper, on Tuesday said that members of parliament have labelled Ndung'u's reappointment last week "unconstitutional". The paper reported that Charles Kilonzo, an MP, pointed out that the central bank's board of directors, which is supposed to review the performance of the governor, had not met in more than a year. "If the board has not met, who did the review?," Kilonzo said.

The government has, however, stood behind the reappointment, pointing out that it is within the law. The current Central Bank of Kenya Act, which took effect on July 16 last year, does not require the appointment of the central bank governor to be ratified by parliament, stating only that that the country's president can appoint the governor, deputy governor and directors of the central bank. These officers may be appointed for a maximum of two terms. "The law provides for the reappointment of the governor unless the appointing authority [the president] is not satisfied with the performance," Oburu Odinga, the country's assistance finance minister, reportedly told parliament.

Parliamentarians, however, countered that even if the law allowed for the reappointment, it was not fair. "Even if new laws have not been made, don't you think the Constitution is enough to compel that all public jobs are advertised? I have no doubt that the governor is qualified, but don't you think it is good practice to afford equal opportunity?" Martha Karua, a lawmaker, asked.

Representatives at the central bank could not be reached for comment. The Central Bank of Kenya Act also allows the country's President to fire a governor, deputy governor or director without parliamentary consultation. If an officer becomes bankrupt; is convicted of fraud; is judged to be of unsound mind; is absent without official leave for three consecutive meetings; or otherwise becomes incapable or incompetent in performing his duties, the President can launch termination proceedings. This involves appointing a tribunal of three members consisting of current or former High Court and Court of Appeal judges, which is tasked with investigating the issue and reporting back. The president can then act on the tribunal's recommendation.

Ndung'u was last Friday reappointed as governor of the central bank, giving him his second and final four-year term. His first term was set to expire on March 4. Ndung'u presided over the launch in November 2009 of the first automated trading system for treasury bonds in Kenya. He was also at the helm when M-Pesa, a mobile money service that has since gone international, was launched in October 2009 – an achievement which one lawmaker on Tuesday said he should be given full credit for, given the role of Safaricom, the mobile phone company that developed the system.

Ndung'u faced a presidential inquiry in July 2008 after allegations made by the then-prime minister Raila Odinga concerning his role in the controversial sale of a hotel in Nairobi.