President William Ruto’s government is using less than a third of the money it collects under the affordable housing taxes to build houses.
Apparently, in the financial year ended June 2024, the government collected Sh. 54.16 billion under the controversial housing tax. However, out of these funds, only Sh. 16.65 billion was used on the project.
This has been revealed by a report from the office of the Controller of Budget Dr. Margaret Nyakang’o.
“Housing and Urban Development faced significant challenges in the Affordable Housing sub-programme, with a low absorption rate of 26 percent, reflecting delays in project implementation,” Dr. Nyakang’o stated in the CoB report.
The low rate of utilization for the project comes barely months after the State Department of Housing stated that over Sh. 20 billion of the collected funds had been invested in Treasury Bonds and Bills.
As at April 2024, the department had collected Sh. 34.72 billion. Out of this, only Sh. 6.93 billion had been used on the housing project.
The department had claimed that the Affordable Housing Board was expecting to receive Sh. 63.22 billion from the affordable housing levy in the 2024/25 financial year that starts in July.
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Out of the Sh. 63.22 billion, Sh. 32.5 billion would be earmarked for the construction of affordable housing, Sh. 15 billion for social housing, Sh. 1 billion for construction of police housing and Sh. 14.66 billion for social and physical infrastructure.
