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Economy

Land compensation delays SGR phase 2

SGR terminus at Miritini, Mombasa. FILE PHOTO | NMG
SGR terminus at Miritini, Mombasa. FILE PHOTO | NMG 

Lack of a compensation plan for land owners has held back bid to build the Nairobi-Naivasha standard gauge railway, four months after Kenya secured funding.

The Kenya Railways was supposed to prepare and submit the plan to the National Land Commission (NLC) to set in motion the process of acquiring wayleaves for the wider railroad.

The 120-kilometre Nairobi-Naivasha line will cost Sh150 billion, and connects to the recently completed stretch from Mombasa port to the capital city Nairobi. The contractor, China Road and Bridge Construction, was to move to site in July.

“Our hands are tied. We were expecting a resettlement action plan from Kenya Railways weeks ago. We can’t go to the ground to clear the way without the plan,” NLC chairman Muhammad Swazuri said in an interview.

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Kenya Railways managing director Atanas Maina did not answer our phone queries.

The railroad will cut through the Nairobi National Park, town centres and agricultural zones like Maai Mahiu, according to Dr Swazuri, highlighting the heavy compensation burden awaiting taxpayers.

Environmental conservationists have challenged the plan to have the project traverse through the wildlife park.

The government has fashioned the planned line as a key link to Kenya’s industrial drive through movement of goods and inputs connecting to proposed special economic zones in geothermal energy-rich Naivasha.

Land compensation bill for the completed Mombasa-Nairobi line, covering 609km, stood at Sh33 billion, equivalent to 10 per cent of the total project cost of Sh327 billion.

An internal audit report by Kenya Railways last year revealed massive irregularities in compensation of individuals and companies whose land the government acquired to pave the way for the Mombasa-Nairobi line.

The report revealed that some owners of land and property were unjustifiably overpaid.

Kenya Railways compensates land owners with cash from collections done through the Rail Development Levy, which was introduced in 2013 to help finance upgrade of the rail network.

The levy is charged at 1.5 per cent of imported goods, amounting to in excess of Sh22 billion annually. Ministry of Land officials last year announced plans to introduce a valuation index that will classify which lands are eligible for compensation for projects and track prices across the country to lock out fake claims.

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