NTSA Sh300billion license deal with Pesa Print Limited dangerous, MPs warn

Members of Parliament have raised alarm over a Sh300 billion public-private partnership (PPP) deal between the National Transport and Safety Authority (NTSA) and Pesa Print Limited for the production of smart driving licences, questioning its value for money and long-term implications for taxpayers.

The 21-year contract will see Pesa Print take over the production and management of smart driving licences, with projections indicating the project could generate up to Sh900 billion in revenue over the contract period. Legislators, however, expressed concern that up to 76 per cent of this revenue could go to the private partner.

Appearing before the National Assembly’s Public Debt and Privatisation Committee chaired by Abdi Shurie, NTSA Director General Nashon Kondiwa faced tough questions over the rationale behind outsourcing a service that had already proven highly profitable under government management.

Lawmakers pointed to data showing the smart driving licence project had generated Sh6.7 billion from an initial investment of Sh1.2 billion, questioning why such a lucrative venture was being handed over to a private entity.

“Why shift to a private partnership model for a system that was already delivering strong returns to the Exchequer?” Shurie posed.

Ijara MP Abdi Ali Abdi echoed the concerns, noting that the government had achieved over 500 per cent returns on the project. “Why abandon such a model?” he asked.

Under the proposed PPP arrangement, MPs warned that the private investor could reap up to Sh600 billion in profits, raising concerns over disproportionate benefits and long-term revenue loss for the State.

Nominated MP Suleka Harun criticised the deal, saying it effectively hands over a steady revenue stream from Kenyan drivers to private interests for more than two decades.

Lawmakers also questioned the necessity of involving a private partner in a project centred on secure document printing, arguing that the government already has the technical capacity through agencies such as the National Registration Bureau.

In response, Kondiwa defended the PPP model, citing chronic underfunding by the National Treasury that had slowed the rollout of smart licences.

He said NTSA had only managed to issue 2.7 million licences against a target of 5 million over nine years due to budget constraints.

“The revenue generated goes directly to the Exchequer, not NTSA, creating a funding gap for expansion,” he said, adding that the partnership would enable scaling up of services, including increasing enrolment centres from 30 to nearly 300 nationwide.

Despite the explanation, MPs remained unconvinced and raised concerns over the procurement process and whether alternative financing options had been adequately explored.

The committee warned of potential risks, including contingent liabilities if the government fails to meet agreed production targets, and signaled it could summon officials from the National Treasury and the PPP Directorate for further scrutiny.