A major blow has been dealt to President William Ruto’s flagship affordable housing project, as the Court of Appeal declined to extend an order allowing the government to collect the controversial housing levy. This decision throws the future of the ambitious initiative into uncertainty, sparking concerns about its funding and feasibility.
The levy, initially introduced in January 2023, imposed a 1.5% deduction on salaries exceeding Ksh.4,000. Its purpose was to fund the construction of 250,000 affordable housing units annually, catering to Kenya’s burgeoning housing deficit. However, the levy faced immediate legal challenges, culminating in its suspension by the High Court in November 2023.
Ruto’s administration sought a reprieve from the Court of Appeal, requesting an extension of the existing order that allowed the levy’s collection pending the finalization of court proceedings. However, the judges dismissed the request, effectively halting the revenue stream for the housing project.
“The Court finds that the balance of convenience does not tilt in favor of granting the government’s application,” stated Judge Roselyn Nambuye, reading the unanimous verdict. “The potential prejudice to the petitioners if the order is extended outweighs the potential prejudice to the government if it is not.”
The ruling elicited mixed reactions. While some Kenyans expressed disappointment and concern about the potential impact on the housing project, others welcomed the decision, citing concerns about the levy’s transparency and impact on taxpayers.
“This is a victory for Kenyans,” declared John Mwangi, a petitioner against the levy. “The government cannot impose such a burden without proper consultation and clear accountability on how the funds will be used.”
Housing sector stakeholders, however, painted a grim picture. Developers warned of stalled projects and job losses due to the funding freeze.
“We are already grappling with financial constraints,” lamented Jane Wambui, a real estate developer. “This decision effectively puts the brakes on the entire affordable housing agenda. Thousands of Kenyans who were dreaming of owning their own homes will be left in the cold.”
The government, while disappointed by the verdict, vowed to continue pushing for the housing project. State House spokesperson George Njoroge maintained that alternative funding options are being explored, and the government remains committed to delivering affordable housing for Kenyans.
“This is a temporary setback,” Mr. Njoroge stated. “We are exploring all legal and practical options to ensure the success of this crucial initiative. We urge Kenyans to remain patient and supportive.”
The Court of Appeal’s decision undoubtedly throws a wrench into Ruto’s housing plans. The government now faces a critical juncture: adapt and find alternative funding solutions, or risk seeing its flagship project grind to a halt. The coming months will be crucial in determining the fate of the affordable housing initiative and its potential to alleviate Kenya’s housing crisis.
With public scrutiny, legal hurdles, and funding uncertainties in its path, the housing project now hangs in the balance. Whether it can weather this storm and deliver on its ambitious promises remains to be seen, but one thing is certain: the journey towards affordable housing for all Kenyans has just become significantly more challenging.