The ongoing expansion of Kenya’s road network, combined with budget shortfalls and inflation, has compelled the government to increase the Road Maintenance Levy (RML). Recent data from the Ministry of Roads and Transport indicates that the value of the nation’s road assets has risen to approximately Sh4 trillion, positioning it as one of Kenya’s largest public investments.
Since the last adjustment in 2016, when the levy increased from Sh12 to Sh18 per litre, inflation and the depreciation of the Kenyan shilling against the US dollar have significantly impacted the costs of imported construction materials. The levy was originally set at Sh1.5 per litre in 1994, with incremental increases over the years, culminating in the recent adjustment to Sh25 per litre for petrol and diesel, slightly lower than the proposed Sh28.
The Ministry noted that the RML rate has been regularly revised to reflect changing economic conditions. The depreciation of the shilling—losing up to 34% of its value against the dollar—has exacerbated the rising costs associated with road construction and maintenance, creating a substantial annual deficit of Sh63 billion in the road maintenance fund.
Despite the increase, the RML collections have stagnated at around Sh80 billion annually since 2016, equivalent to Sh52 billion in 2016 prices, necessitating an increase to at least Sh122 billion for the fiscal year 2023-24 to maintain the fund’s real value.
With the road network expanding by 48% over the past decade, reaching 239,122 kilometers, the demand for maintenance has escalated. Approximately 30% of this network is reported to be in poor condition, requiring considerable resources for restoration.
As urbanization and vehicular traffic continue to rise, the government is urged to explore alternative revenue sources while balancing the needs of motorists who oppose the increased levy. The transport sector, a vital contributor to the GDP, underscores the importance of sustainable road maintenance for Kenya’s economic development.
Impact of Higher Road Maintenance Levy on Kenya’s Transport
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