The government says it needs Sh5.146 trillion to enhance connectivity and maintain 69 per cent of the road network in the next 10 years.
However, the projected available development budget is only Sh1.096 trillion, a move that has pushed authorities to seek alternative ways of financing road projects.
Chairperson of the technical working group on road tolling Kefa Seda said yesterday the huge deficit calls for exploration of alternative financing mechanism.
“The government has attempted to expand some of the key high-traffic corridors through its own revenue sources, borrowing from bilateral and multilateral lenders. However, continued reliance on borrowing has become unsustainable as the government has exceeded its debt borrowing ceiling,” Seda said.
The exchequer and Road Maintenance Levy Fund are currently the major sources of finance for road development and maintenance.
The road maintenance fund was initially set at Sh18 per litre, but it has since been increased to Sh25 beginning of the financial year 2024-25.
Seda said given the current budgetary constraints and the projected decline in road maintenance fund due to the adoption of e-mobility, among other reasons, other sources of finance need to be explored.
“The government has explored alternative financing mechanisms such as public-private partnership, and considers tolling as a viable funding mechanism for road construction in major corridors,” he said.
Seda made the remarks at Panari Hotel when Kenya National Highways Authority engaged Kenya Editors Guild over the new tolling policy that the government is seeking to introduce to fill the financial gap on road development.
Kenya has a road network of 239,122 kilometres. Classified road network is 164,966 kilometres while 74,155 kilometres is unclassified.
This means that 69 per cent of Kenya’s road network is eligible for funding under road maintenance levy.
Seda said a study on economic impact on e-mobility on road maintenance fund, 2023, shows the estimated annual maintenance needs for the road network is Sh253.5 billion while the road maintenance levy fund collection estimates for 2024-25 is Sh100 billion.
He said there is a further maintenance backlog of estimated Sh500 billion besides the damage on the road network caused by recent heavy rains.
Seda said with financial constraints on exchequer, road maintenance levy fund alone cannot sustain the maintenance of road network in the long-term. This is due to lack of regular indexation of fuel levy rates to inflation, improved vehicle-fuel efficiencies, expanding road networks and the projected growth in electric vehicles, decline in vehicle registration.
He said the funds from the exchequer has been declining, giving an example of the financial year 2023-24, where the sector needed Sh300 billion but only Sh50 billion was available.
Thika Superhighway, Mombasa Southern Bypass and the Dongo Kundu Bypass are some of the roads planned for tolling.
Seda said the tolling of the Nairobi expressway has improved functionality, helped reduced travel time and improved safety.
