Treasury Cabinet Secretary John Mbadi during a past event/FILETreasury Cabinet Secretary John Mbadi has strongly defended the government’s decision to securitise part of the fuel levy.
Dismissing criticism by former Budget and Appropriations Committee chairperson Ndindi Nyoro over its impact on fuel prices, Mbadi said everything was done in accordance with the law.
“There is nothing, nothing at all secret about securitisation. Everybody knows it. Where does he live if he doesn’t know we were securitising this money? We will continue doing it, and we have no apologies to make,” Mbadi stated.
Speaking during an event in Nairobi, Mbadi sought to explain about the Road Maintenance Levy.
He clarified that the original Sh18 levy remains untouched and is strictly allocated to road upkeep.
He said the Sh7 addition, however, was intentionally redirected to unlock stalled infrastructure projects by clearing pending payments owed to road contractors.
“We had a choice, either continue pouring that money into murram roads that are swept away every rainy season, or use it to revive major road projects. Contractors had downed their tools because we owed them about Sh130 billion,” he explained.
Mbadi revealed that through the securitisation strategy, the government has already raised over Sh60 billion, allowing many contractors to resume work.
The plan targets Sh175 billion in total, which he stated that when combined with the annual infrastructure allocation of Sh57 billion, it is expected to clear all pending certificates within three years.
“In the current fiscal year, if we use even half of that and add it to our regular allocation, we will have about Sh120 billion, enough to settle outstanding bills. If we do the same next year, all ongoing road works will be completed,” he said.
His remarks follows a similar statement by Roads and Transport Cabinet Secretary Davis Chirchir.
Chirchir reassured the public that the ongoing securitisation plan is transparent and above board.
He said the programme is being implemented with complete openness and in strict adherence to legal and financial protocols.
“We wish to reassure the public that there is no secrecy in this process,” Chirchir stated.
According to the CS, all the necessary approvals were met, with the process undergoing comprehensive due diligence.
“All statutory requirements were fulfilled, and the process underwent due diligence, approvals, and oversight by the National Treasury and the Attorney General’s office to ensure compliance with Kenya’s financial laws,” Chirchir said in a statement.
The Kenya Roads Board (KRB), the implementing agency, he added, is ready to openly engage with stakeholders, Parliament, the media, and the public to explain the structure, benefits, and safeguards of this innovative financing model.
He was responding to recent media reports concerning the ministry’s initiative to raise funds to settle verified pending bills in the roads sector, which currently total Sh175 billion.
Kiharu MP Ndindi Nyoro had on Tuesday poked holes into the government's decision to securitise the levy and borrow Sh175 billion against it, without parliamentary approval or public disclosure.
“This borrowing is not captured in official debt records, and Parliament was never consulted. That raises grave concerns about transparency, legality, and long-term fiscal sustainability,” he said.
