Gov’t considers securitizing HELB, Hustler Fund, and road levy
Principal Secretary Dr. Chris Kiptoo stated that up to 50 percent of the revenue collected from the road maintenance levy will be directed toward the securitization initiative.
The National Treasury has defended its decision to securitize the road maintenance levy, explaining that this move aims to ensure the completion of ongoing road construction projects.
Principal Secretary Dr. Chris Kiptoo stated that up to 50% of the revenue collected from the road maintenance levy will be directed toward the securitization initiative.
With government finances becoming increasingly constrained, the Treasury is exploring alternative funding mechanisms to keep projects on track.
As borrowing options become more limited, securitization has emerged as a viable strategy to maintain steady funding for essential infrastructure development.
Securitization is a financial arrangement where “future revenue streams are sold to investors to raise funds upfront,” enabling the government to address current fiscal demands while deferring some financial resources from the future.
Principal Secretary Chris Kiptoo explained that, in addition to securitizing the road maintenance levy where up to 50% of collections will be allocated for repayments the government is also exploring securitization of payments from the HELB, Hustler Fund, and Youth and Women Enterprise Fund.
“For Kenya to lower its debt burden and achieve its development goals amid fiscal challenges, innovative solutions are needed to raise capital. The National Treasury, Central Bank, and Capital Market Authority are working on market-based instruments to enable borrowing from the diaspora by securitizing future cash inflows,” Kiptoo stated.
Speaking before the debt and privatization committee, the PS also revealed plans to roll out a single Treasury account, recently approved by Cabinet.
This reform aims to enhance public finance management by promoting transparency, accountability, and reducing borrowing costs.
The National Treasury has begun steering the shift to a single Treasury account, set to roll out in three phases starting in the 2025/26 financial year.
Phase one will include ministry departments and agencies, phase two will cover county government entities, and phase three will involve SAGAs and state corporations.
While the Treasury has identified additional funds for potential securitization, specifics on which projects will be financed through the raised capital are yet to be disclosed.
