Red flag over affordable housing shaky funding
A section of the Affordable Housing Project in Mukuru, Nairobi on December 11, 2024.
What you need to know:
- Ms Nyakang’o noted that lack of funding was one of the key challenges for one of President William Ruto’s pet projects.
- The State Department for Housing spent Sh25 million on the project during the three months to end of September 2024.
The Controller of Budget (CoB) Margaret Nyakang'o has flagged shaky funding for the affordable housing programme, exposing the State's poor performance on one of its flagship projects for the second year in a row.
Despite billions of shillings levied from Kenyan workers monthly to fund the housing programme, the CoB’s report shows the State is far from hitting the 250,000 houses a year target needed to address housing demand.
Between July and September 2024, the State Department for Housing spent Sh7.9 billion on construction of the affordable houses. This was half the expected expenditure of Sh15.8 billion (25 percent) of the annual affordable housing programme budget of Sh63.22 billion.
Ms Nyakang’o noted that lack of funding was one of the key challenges standing in the way of one of President William Ruto’s pet projects.
“Except for the project under Kenya Urban Support Programme II, all the projects planned to be implemented by the State Department for Housing and Urban Development were either past the target completion date or lagging the implementation schedule,” the CoB stated.
“Further, the Kenya Informal Settlement Redevelopment Project (Kisrip) did not attract funding, which is contrary to the government’s plans to close the housing gap by facilitating the delivery of 250,000 houses per year,” the CoB stated.
The Kisrip project was started in July 2024 and is supposed to be funded by the government to the tune of Sh936 million in three years to June 2027.
The CoB report shows that the State Department for Housing spent Sh25 million on the project during the three months to end of September 2024, about a third of the expected spending during the period.
In May, the Housing Principal Secretary Charles Hinga told a parliamentary committee that out of the Sh34.7 billion Housing Levy collections by April 2024, Sh20 billion had been transferred to the Affordable Housing Board for investment in Treasury Bills and Bonds.
“The Board can only invest the money in Treasury bills because it is not an implementing agency. The act does not provide an avenue for the board to spend the money,” Mr Hinga told Parliament’s Housing, Urban Planning and Public Works committee.
Controversy continues to surround implementation of the affordable housing programme.
While the State holds that 4,888 houses have been completed in just two years, the Architectural Association of Kenya in a recent report indicated that only 1,189 houses have been completed since the current administration took office.
