The Road Maintenance Levy Fund Act is central to Kenya's road maintenance funding framework. It empowers the relevant Cabinet Secretaries to impose a levy on petroleum fuels used in Kenya, with the levy adjusted from time to time through Gazette notices.
The proposed amendment would increase the Road Maintenance Levy by Kshs 7.00, from Kshs 18.00 to Kshs 25.00 per litre of petrol and diesel. The proposal follows the last review in July 2016 and is intended to respond to rising road maintenance costs and the expanded size of Kenya's road network.
The stated reasons include inflation, macroeconomic pressure, expansion of the road network, higher fuel import costs and funding constraints affecting KeRRA roads.
The proposal also raises the question of Road Annuity Fund allocation. A higher, more predictable allocation could improve the bankability of road PPP projects by giving investors and financiers more certainty around ring-fenced funding.
The potential upsides include better road quality, economic efficiency and more responsive maintenance funding. The downsides include pressure on consumers, possible inflationary effects and equity concerns for lower-income households and small businesses.
The amendment therefore sits at the intersection of road maintenance, public finance, PPP bankability and consumer impact. Its value depends on transparent allocation, disciplined implementation and accountability in how the funds are used.
The views expressed in this article are Paula’s own and do not necessarily represent those of her employer or any affiliated organisation.