NAIROBI,Kenya— Treasury Cabinet Secretary John Mbadi has stirred debate after defending the government’s decision to reallocate funds from the Road Maintenance Levy, in the wake of revelations by Kiharu MP Ndindi Nyoro that the levy had been used as collateral for a new financial facility.
Mbadi explained the rationale behind the recent increase in the fuel levy, which saw Sh7 added to the Road Maintenance Levy.
He argued that the decision was aimed at unlocking stalled infrastructure projects rather than perpetuating misuse of funds.
“The road maintenance levy as it is right now is not being used in a way that makes Kenyans see the value of that levy. We had a fiscal space that is constrained and all the contractors working on our major roads had stopped working,”he said.
“We had a choice to continue misusing this additional seven shillings by putting marram on the roads or use it to get contractors back on the roads and that is the route we took.”
His comments came in response to mounting criticism following Nyoro’s allegations that the government had securitized the Road Maintenance Levy to secure what he termed “illegal debt.”
The remarks have reignited public concern over transparency and the country’s rising cost of fuel.
Roads and Transport CS Davis Chirchir also weighed in, defending the securitization model as both legal and fiscally prudent.
In a statement, he said the government had raised Sh175 billion through securitization to settle pending bills owed to road contractors, which had stalled over 580 projects nationwide.
“Securitization, in this context, is not the creation of new debt. Rather, it is the sale of the rights by the Kenya Roads Board to a Special Purpose Vehicle (SPV) to receive a portion of the future Road Maintenance Levy,” Chirchir stated.
Energy CS Opiyo Wandai meanwhile distanced the fuel price hikes from the levy securitization, attributing the Sh8.99 increase in super petrol and similar hikes in diesel and kerosene to fluctuations in global oil prices.
Despite these explanations, public discontent continues to mount, with many Kenyans questioning whether the government’s financing models are serving citizens or simply deepening the cost of living crisis.
