The Committee on Housing, Urban Planning and Public Works held sessions with the State Departments for Housing & Urban Development and Public Works to consider the 2025/26 Budget Policy Statement (BPS) in preparation for the next financial year's Budget.
Chaired by Hon. Johanna Ng'eno, the Committee was briefed on the Budget Implementation status of the financial year 2025/26. Key policies underpinning the expenditure ceilings and indicative performance targets linked to the policies and programs in the 2025 BPS, among others.
The Committee noted that the State Department for Housing and Urban Development (SDHUD) had utilized Kshs. 21,110.07 million out of the approved budget of Kshs. 85,195.80 million as of 31st December 2024 representing an absorption rate of 25%.
The committee members demanded explanation as to the slow uptake of funds in the 1st half of the year, which sought to be apprised on why markets stall, utilization of Boma Yangu proceeds and utilization of accrued interests of the Affordable Housing monies invested in Treasury Bills.
Speaking before the Committee Members, the Permanent Secretary for SDHUD, Mr. Charles Hinga attributed the slow absorption rate to delays in the disbursement of funds by the Affordable Housing Board caused by lengthy onboarding of Board onto Government payment system being a new state corporation. The Board came into being in March 2024.
The PS explained that the onboarding process was lengthy and involved the National Treasury and the Central Bank of Kenya. As a result, The Board only accessed funds in October, more than 3 months into the new financial year.
The PS assured the committee that the absorption in the last half of the year shall be much faster given the many contracts for construction of affordable housing in virtually every part of the country.
The PS informed the committee that there were 124k units under construction with another 121k awarded and under negation.
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