The High Court has declined to halt the National Infrastructure Fund Act, 2026, but has placed the fund under strict judicial oversight, directing the National Treasury to account for every shilling spent while a constitutional challenge is heard.

In a ruling delivered on Thursday, Justice Patriciah Nyaundi said the petition by Katiba Institute raises “weighty” and “arguable” constitutional questions that must be determined on merit. However, she found that freezing the entire law at this stage would be too disruptive.

Justice Nyaundi acknowledged that Katiba Institute had established a prima facie case. The petition argues that the National Infrastructure Fund Act, 2026 raises significant constitutional and public finance concerns.

But suspending the whole statute immediately, the judge said, was not the most appropriate interim remedy. A less intrusive measure was needed.

To address the risk that money could be spent in ways that would make any eventual court relief meaningless, the court imposed accountability conditions. The Treasury must now disclose and account for all expenditure from the fund as the case proceeds.

"The constitutional challenges raised by the petitioner are weighty, arguable and deserve a full hearing on their merits," Justice Nyaundi held.

She noted that without interim safeguards, there was a possibility of unchecked spending that could undermine the petition. Requiring continuous financial disclosure, she said, strikes a balance between protecting the public interest and permitting government operations to continue.

Under the orders, the implementation of the National Infrastructure Fund Act, 2026 may go ahead. However, the National Treasury has been put on notice to ensure transparency and accountability at every step.

The court reasoned that this approach preserves the integrity of the constitutional process while avoiding a complete shutdown of infrastructure financing. It also gives the court a live record to review if it later finds parts of the Act unconstitutional.

The National Infrastructure Fund was established to pool and manage resources for priority public projects. The government has argued it is critical for accelerating development.

Katiba Institute, on the other hand, contends that the law as structured violates constitutional provisions on public finance, oversight, and accountability. It wants the court to declare the Act invalid.

The case will now proceed to a full hearing, where the court will determine whether the Act complies with the Constitution.