Housing Fund Levy to be made voluntary

Friday, December 13th, 2019 00:00 |
Houses in Nairobi’s Tassia estate. Photo/PD/KENNA CLAUDE

The government will now make the Housing Fund Levy voluntary to kick-start the project that has been facing legal hurdles since it was mooted last year. 

President Uhuru Kenyatta, in his Jamhuri Day address, yesterday said the facility would not be mandatory so that the implementation process is not derailed.

“You all know, the implementation of the Housing Fund Levy as a mandatory contribution, for both employees and employers, has at every turn, been fraught with an avalanche of legal hurdles and obstacles. But we need to soldier the nobility of this programme,” said the President.

Uhuru directed Treasury and Housing Ministry to move to Parliament, with immediate effect, and have legal requirements revised so as to make the contribution voluntary.

The government planned to take 1.5 per cent of workers gross salary in the formal sector to set up a housing fund.

However, the fund has faced stiff opposition with the Central Organisation of Trade Unions (Cotu), Trade Union Congress of Kenya, Consumers Federation of Kenya (Cofek) and the Federation of Kenya Employers (FKE) filing various suits challenging it.

But the President explained that creation of the housing fund was informed by the need to bridge the gap between the have and the have-nots, by creating a framework through which, the traditionally unbanked can access financing towards home-ownership.

“The Housing Fund is one of the entities through which the delivery of the affordable housing programme will be supported,” said the President.

He said the journey to fulfill the Jubilee administration’s pledge towards affordable housing programme has already kicked off.

Last week, he commissioned the first phase of the project by the United Nations Office for Project Services (UNOPS) that will deliver 100,000 units across the country.

The President added that affordable housing programme would continue to deepen and accelerate access to housing far beyond immediate target date of 2022, of building 500,000 housing units.

The move would set Kenya on an extraordinary path as Africa’s first country to substantively address housing and social amenities challenges.

“By way of returning the river to its course, my administration is vigorously implementing the Kenya economic blue print - Vision 2030, whose current phase, the Third Medium Term Plan, is prioritised as Big-Four agenda,” Uhuru said.

“The Big Four Agenda is crafted to accelerate the realisation of overriding objective of Vision 2030, which is to transform Kenya into a newly industrialising, middle-income country providing a higher quality of life to all its citizens by 2030, in a clean and secure environment,” he said.

As part of the achievements of the Big Four, the President said, the Government had successfully rolled out the pilot phase of the programme in Nyeri, Kisumu, Isiolo and Machakos counties.

The programme has since witnessed enhanced access to essential health services, with an average of 39 per cent reported in the pilot counties.

He noted that the Government had invested quality time to prepare for the full rollout of the programme by the beginning of 2020, to cover the remaining 43 counties.

“I urge county governments and the Ministry of Health to conclude and sign the Intergovernmental Partnership Agreement by the end of January 2020,” the President directed.

And to enhance earnings of farmers, Uhuru said the Government would promote agriculture through structured trading by negotiating market access for farmers’ produce in international markets, and restructuring the Kenya National Trading Corporation to better receive and manage farm produce.

“We continue to promote our produce abroad to deepen markets and further explore marine and aquaculture resources in consideration of the new global blue economy model,” he said.

He said efforts were being made to revitalise and restore cash crops’ contribution to national life. He said his administration would continue to support tea farmers to enhance diversification of tea varieties.

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