Why Nairobi Expressway Toll Fees Are Yet to Fall Despite a New Law Requiring It

In Summary

• The government has delayed lowering Expressway toll fees despite improved economic conditions.
• KRA is tightening tax compliance measures by targeting small businesses and the digital sector.
• Patients without cash or private insurance are struggling to access healthcare in private hospitals.
• The long-running debt dispute has disrupted operations for both Nairobi County and Kenya Power.
• Despite lower fuel and power prices, the cost of living remains high as businesses delay passing on the savings to consumers.
• Ketraco is pushing for PPPs to expand and strengthen Kenya’s power transmission network.

The government has not implemented a recommendation by the Kenya National Highways Authority (KeNHA) to lower toll charges on the Nairobi Expressway, despite inflation falling and the shilling strengthening against the dollar, as reported by The Business Daily. The law allows for a reduction in toll fees under such conditions, but the Ministry of Transport argues that it is too soon to make adjustments. Motorists had anticipated lower toll rates from July 1, 2024, but the charges remain unchanged, benefiting the Chinese firm operating the road, which is expected to earn Ksh106.8 billion over its 27-year contract. 

In a report by The People’s Daily, private hospitals have stopped accepting the Social Health Authority (SHA) cover, leaving patients with no choice but to pay in cash or seek treatment elsewhere. The Kenya Association of Private Hospitals (KAPH), which represents about 330 facilities, says the decision follows a Ksh30 billion debt from the defunct NHIF, delays in reimbursements, and unclear operational procedures under SHA. As a result, many patients are stranded, with some hospitals only attending to emergency cases for those with private insurance. 

Ketraco has identified 14 power transmission projects for development under the Public-Private Partnership (PPP) framework in its 2024-2043 masterplan, with key projects expected to be completed by 2027. The State-owned firm is partnering with Africa50 and PowerGrid Corporation of India to develop major transmission lines, including the 400kV Lessos-Loosuk and 220kV Kisumu-Musaga lines. Other projects under review include transmission lines and substations aimed at improving power reliability across various regions, as reported by The Standard. 

The Kenya Revenue Authority (KRA) has created new departments aimed at bringing more small traders and digital businesses into the tax system, as part of its plan to grow the number of active taxpayers by four million by 2029, as reported by The Business Daily. The new Micro and Small Taxpayers Department will focus on informal businesses, while the Business Strategy Technology and Enterprise Modernization Department will use artificial intelligence and data analytics to enhance tax compliance. The taxman is banking on MSMEs, digital businesses, and agribusiness to boost revenue collection, at a time when banks have also introduced new requirements for small traders under anti-money laundering regulations. 

A dispute between Nairobi County and Kenya Power has escalated after the county dumped garbage at Stima Plaza, the power firm's headquarters, in protest over unpaid wayleave fees amounting to Ksh4.8 billion. According to The People’s Daily, Kenya Power, on the other hand, claims the county owes Ksh3.1 billion in electricity bills, leading to power disconnections at several county offices. The standoff has seen the county cut water supply and block sewers for Kenya Power, with both sides blaming each other for failing to honour payment agreements. 

The Standard reports that despite a significant drop in fuel and electricity prices over the past year, Kenyans have yet to feel the impact through lower costs of goods and services. Analysts attribute this to delayed adjustments by businesses, high credit costs, weak disposable incomes, and firms struggling to recover from past economic hardships. Consumer advocates argue that industries should pass on the benefits of reduced production costs, as they are often quick to increase prices when costs rise. 

Kenya plans to stop rice imports by 2032 as ongoing irrigation projects boost local production, according to Irrigation PS Ephantus Kimotho, as reported by The Star. The country currently faces a rice deficit of 770,000 metric tonnes, spending about Ksh38.83 billion annually on imports. The completion of key projects like the Bura irrigation system and Thiba Dam has already increased local production from 190,000 to 270,000 metric tonnes. Future plans under Public-Private Partnerships (PPP) include expanding the Galana Kulalu Food Security Project, with private investors set to cultivate 200,000 acres. Additional projects such as the Mwache, Siyoi-Muruny, and Umaa dams aim to enhance water supply and irrigation. However, a budget shortfall of Ksh31.886 billion threatens timely completion. The ministry aims to rehabilitate 18,500 acres in Bura, expand irrigation by 34,900 acres, and increase water storage by 13.3 million cubic meters by 2027.