News and Analysis
March 14, 2025
In Summary:
According to a report by the Standard, the government is proposing a new Road Toll Policy that could see toll stations introduced on new, upgraded, and existing two-lane roads to raise up to Ksh4.8 trillion for road development and maintenance. According to the policy, the government plans to spend Ksh1.9 trillion annually on road construction and Ksh1.1 trillion on maintenance, with tolling expected to bridge a funding gap of up to Ksh4 trillion over ten years. Toll charges will apply to various vehicle categories, and private operators will manage toll collection, with revenues directed to a dedicated Toll Fund. The policy also proposes linking toll fee payments to insurance renewals and introduces fines of up to Ksh50,000 or six months in jail for toll evasion.
In a report by Nation, Members of Parliament have allocated themselves an additional Ksh1.6 billion in the 2024/2025 budget, raising the Parliamentary Service Commission’s total allocation to Ksh44.25 billion. The increase, contained in the Budget and Appropriations Committee report, will fund MPs’ car grants, mortgage enhancements, committee expenses, and House allowances. The overall Parliament budget includes Ksh18.5 billion for the National Assembly, Ksh6.5 billion for the Senate, Ksh13.9 billion for general expenses, and Ksh5.3 billion for staff pensions and gratuities.
In a report by the Business Daily, investors are shifting back to longer-term Treasury bills as interest rates continue to decline, with the 364-day paper attracting Ksh18.47 billion out of the Ksh35.81 billion total bids in the latest auction. The rate on the 364-day T-bill fell slightly to 10.47% from 10.49%, while the 182-day rate dropped to 9.11% from 9.15%, and the 91-day T-bill rate remained at 8.92%. In contrast to previous auctions where the 91-day paper dominated, investors are now locking in longer-term yields amid falling rates. The domestic borrowing target was raised from Ksh413 billion to Ksh593.7 billion. The Central Bank of Kenya (CBK) has continued to reject expensive bids in both T-bill and bond auctions, including a reopened 25-year bond where it accepted Ksh35.2 billion out of Ksh47 billion in bids at an average yield of 13.8%.
Auditor General Nancy Gathungu has questioned the value for money of Ksh239.78 million spent on reengineering the National Education Management Information System (NEMIS), citing missing ownership documents and lack of proof that the investment was beneficial to taxpayers. According to her latest report, the Ministry of Education did not provide crucial documents such as copyright registration, handover reports, and system administration and compliance records. According to the People Daily, the report also raised concerns about the use of NEMIS data to disburse Ksh132 billion in capitation funds for Free Primary, Junior Secondary, and Free Day Secondary Education, as there was no evidence that student enrolment data had been verified. Additionally, Gathungu noted that NEMIS lacks a cut-off date for student data, complicating the verification of student numbers at any given time, and that it excludes students without birth certificates and those aged 18 and above from funding.
The Social Health Authority (SHA) has come under public scrutiny after releasing a list of hospitals paid Ksh11.4 billion for services rendered between December 2024 and February 2025, with concerns raised over small private hospitals receiving disproportionately high payments. The Kenya Medical Practitioners, Pharmacists and Dentists Union (KMPDU) has called for an audit of the hospital list to verify legitimacy and prevent collusion, citing fears of imaginary hospitals being paid, as seen in the defunct NHIF. According to the Standard, Principal Secretary for Medical Services Harry Kimtai defended the publication as a transparency measure and assured that audits and forensic reviews would be conducted to verify claims.
The Energy and Petroleum Regulatory Authority (EPRA) has announced that fuel prices will remain unchanged until April 14, 2025, with petrol, diesel, and kerosene retailing at Ksh176.58, Ksh167.06, and Ksh151.39 per litre, respectively, in Nairobi as reported by the Capital Business.
In a report by the Business Daily, Data from the Association of Kenya Insurers (AKI) shows that 327 insured vehicles were stolen in the year ended 2024, with station wagons accounting for 67.8 percent of the thefts, mostly targeting white Toyota models insured for less than Ksh1 million. Other commonly stolen brands included Isuzu, Mazda, Nissan, Mitsubishi, and Subaru, while lorries, saloons, and pick-ups also featured. Vehicles with registration numbers starting with KDs and KCs were most affected. Although thefts of insured vehicles dropped by 28 percent from 419 the previous year, recovery rates remain low at 15.92 percent despite improving from 11.72 percent. AKI noted that nearly a third of the stolen vehicles were valued below Ksh1 million, and only 27.3 percent exceeded Ksh3 million. The Insurance Regulatory Authority reports motor vehicle insurance remains loss-making, with insurers posting Ksh5.92 billion in underwriting losses in 2023, despite a drop from Ksh7.59 billion the year before.
Nairobi County Government has disowned a Ksh3.9 billion compensation claim by the trustees of Jamia Mosque for 5.14 acres of land at Globe Cinema roundabout, stating it never requested the National Land Commission (NLC) to compulsorily acquire the land. In court documents, the county says it has not budgeted for the acquisition and was not involved in the gazettement process, which it argues is unconstitutional. The mosque’s trustees are seeking compensation for the land, which has been used as a matatu holding area, while NLC maintains that the property remains under the mosque’s ownership as reported by the Business Daily.
Kenya’s public debt service costs rose by Ksh68.7 billion to Ksh666.3 billion in the six months to December 2024, driven by higher domestic interest payments, according to the Controller of Budget. According to the Business Daily, the report shows interest payments on domestic debt surged to Ksh325.7 billion from Ksh125.08 billion a year earlier, as the government settled Ksh432.83 billion in Treasury bills and bonds. Domestic debt stock grew 8% to Ksh5.87 trillion, while external debt declined slightly to Ksh5.06 trillion, bringing total public debt to Ksh10.93 trillion. The government borrowed Ksh487.14 billion in new domestic loans and plans to spend Ksh1.91 trillion on debt servicing for the full fiscal year ending June 2025, including Ksh1.32 trillion on domestic debt.
A new Kenya Institute of Management (KIM) survey shows that only 32% of CEOs and MDs in Kenya are women, with men still holding 67% of these top leadership roles. The report also reveals that only 21.3% of board chairpersons are women, while 76.8% are men. Board-level gender diversity has slightly declined from 36% in 2021 to 35% in 2024, with eight in ten company boards having more male than female members. The average ratio of women to men in boardrooms stands at one to four. According to the Business Daily, although there has been some progress—female board chairpersons rose from 7.7% in 2017 to 21% in 2021—representation of young women on boards remains low at 19.4%. Globally, women hold just 23% of board seats, highlighting the need for targeted efforts to increase female leadership in Kenya and beyond.
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