Kenyans have now been invited to contribute into a housing scheme through savings investments that can also be regained with a top up return after seven years if the beneficiary decides to opt out of the government sponsored affordable housing project.
In a blow by blow breakdown session of what the proposed fund entails at State House yesterday, Housing Principal Secretary Charles Hinga said of the proposal contained in Finance Bill 2023 sails through, the housing units will be delivered in three to four years.
“The fund confers a direct right to either get an affordable unit or, after seven years if one does not want it, we give you back your money plus your return.” The PS noted.
The PS clarified that fund has two schemes; mandatory and voluntary adding that people in the informal sector are allowed to save through the voluntary scheme.
However, those in formal sector will be deducted from their monthly earnings.
In a deliberate attempt to demystify misinformation and misconceptions about the proposed operationalisation of the fund, Hinga said the contribution, the government can confidently get investors for the housing plan, with the assurance that they will be able to pay them after construction is done.
So far 524 parcels of land have been identified in major towns all over the country and noted that Kenyans are at liberty to choose where they want to own a home.
“It is not going to be a blind undertaking, however, we are starting a programme where we are going to put 200 units in every constituency and these 200 units will be taken. I can promise you even if you don’t think there is demand in Mararal or in Karachuonyo or Nyansiongo in Nyamira, first of all, the government is an employer, we have got so many people in there so we are not just going to do this thing carelessly like without due diligence.” The PS observed.
Before coming up with the plan, he added, the requisite benchmarking in various countries which have succeeded in the plan was undertaken.
In the recent past, the proposed levy has been met with fierce criticism with a section of leaders and Kenyans at large demanding that contributions be made voluntarily.
The Finance Bill 2023 is currently in the National Assembly.
“The housing levy should be driven by law and not voluntary because if it is driven by law, we can call investors because there’s an assurance of collecting money even after three years, so long as the law is there.” He added.
While demonstrating optimism PS Hinga told parents who are complaining about the housing levy that: “by the time your child is 18, they can have a unit.”
In his address he said the housing levy contribution will provide Kenyans with a significant return compared to fixed deposit accounts.
“Let us disagree where we have to disagree, but let’s not beat this thing (the Housing Fund) so hard that we want it to fail. If it fails, we will not have sorted out the economics of this country or the urbanization issue.” He explained.
