Members of the National Assembly have approved a Bill that will establish the National Infrastructure Fund, a financial vehicle expected to mobilise nearly Sh5 trillion over the next ten years to support large development projects across the country.
The legislation, sponsored by Majority Leader Kimani Ichung’wah, was adopted on Thursday after lawmakers considered it for the third time during the Thursday, March 5, sitting.
Following debate in the chamber, the Speaker called for a voice vote, with the majority of MPs supporting the proposal and allowing it to proceed to the President for assent.
If signed into law, the Bill will create the National Infrastructure Fund, which the government intends to use as a new way of financing development projects without relying heavily on borrowing.
A major feature of the legislation is the requirement that funds raised through privatisation and partial sale of government stakes in state corporations be directed to the new fund rather than absorbed into the annual national budget.
Ichung’wah said Kenya has previously used such proceeds to meet immediate spending needs, including paying salaries and servicing loans.
“Many of these privatisation proceeds have always gone into financing our budget, paying salaries or servicing debt. This Fund will break that cycle,” he said.
Under the new arrangement, money obtained through future initial public offerings and the sale of government shares in state-owned firms will be invested through the fund instead of supporting recurrent expenditure.
The Majority Leader pointed to earlier privatisation programmes involving Safaricom and Kenya Power, noting that opening the companies to private investors improved operations, created employment opportunities and increased government revenue through taxes.
The Bill also provides a governance structure for the fund. It states that management will be placed under a board and secretariat whose members will be recruited through an open and competitive process.
According to Ichung’wah, those selected to lead the institution will work under strict performance contracts and will be subject to regular evaluation to ensure accountability.
Another safeguard included in the law bars individuals who have held political positions or maintained links with political parties within the last five years from being appointed to the board.
Ichung’wah said the restriction is meant to ensure the fund operates independently and is not influenced by political interests.
“This Fund must serve the national interest, not political interests,” he said.
The proposed board will also be required to develop an investment policy, which must receive approval from the National Treasury Cabinet Secretary. The policy will outline the sectors that the fund will prioritise, limits on investment allocations, expected returns and guidelines on how the portfolio will be managed.
In addition, the law directs the fund to give priority to stalled infrastructure projects so that they can be completed before resources are committed to new developments.
Ichung’wah explained that the idea draws from global investment models that have proven successful in supporting long-term development. Among the examples cited were Future Fund of Australia, Temasek and Mubadala.
“These are tested instruments,” he said, adding that Kenya should adopt similar strategies as it works towards strengthening its economy.
The Majority Leader also reminded MPs that the financial demands placed on the national government have increased since the adoption of the 2010 Constitution. He noted that the law requires substantial and mandatory transfers to county governments every year, which places pressure on the national budget.
Because of these obligations, he said the country must find new ways of financing development without increasing the debt burden.
“These national imperatives are not for one leader or one Parliament. They are for this generation and generations to come,” he said.
Despite its passage in the National Assembly, the proposal has attracted criticism from leaders aligned with the United Opposition, who say the fund could weaken accountability.
While addressing journalists on Thursday, the leaders claimed the Sh5 trillion fund could be used to influence the 2027 General Election and avoid full scrutiny by Parliament.
They also rejected the Bill alongside Sessional Paper No. 3 of 2025, which proposes the partial sale of the Government of Kenya’s shareholding in Safaricom PLC.
According to the opposition leaders, the two proposals represent “a dangerous and co-ordinated assault on Kenya’s constitutional framework of public finance management, the long-term integrity of strategic national assets, and already battered public trust in state stewardship.”
They further argued that the plans are being introduced at a time when the country’s financial credibility is under strain. As an example, they pointed to the proposed initial public offering of Kenya Pipeline Company, warning that transactions involving public assets must be conducted through transparent processes, competitive procedures and proper public participation.
