Development
Questions As Govt Invests Sh20B From Housing Levy Funds In T-Bills
Parliament is investigating the allocation of Sh20 billion housing levy funds to Treasury Bills.
The State Department of Housing has been channeling billions of shillings meant for affordable house construction towards Treasury bills, short-term government securities issued by the National Treasury.
These debt instruments are used by the government to raise funds for a short period, typically ranging from 91 days to 364 days.
The National Assembly Committee on Housing, Urban Planning and Public Works has been deducting Kenyans 1.5 per cent of their gross salary, with a similar amount being matched by their employers, towards the construction of one million affordable houses across the country by 2027.
Housing Cabinet Secretary Alice Wahome and Principal Secretary Charles Hinga have confirmed that the investment is still in process, with an amount of Sh20 billion to be invested in a CDS account at the Central Bank.
Nyaribari Masaba MP Daniel Manduku has raised questions about the reasoning behind the move, questioning whether there is a lack of strategy or low absorption of funds in the housing project. Wahome explained that the investment would be for a period of three to six months and urged the MPs to stop insinuating that her ministry was unable to absorb the funds.
Committee chairperson Johana Ng’eno sought to know whether the board was involved in the process and whether it approved the process. Sirisia MP John Waluke asked about the duration of the funds’ stay in the securities and the Housing Department’s intentions. He also asked about the channeling of interest accrued from the funds and whether it would benefit individuals or the government.
Hinga assured the House team that the board had made a resolution to invest the funds and even wrote to the Treasury seeking approval.
He stated that the government is collecting the levy now and may need to pay it out in three or six months time, but that doesn’t mean they do not need the money.
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