Nema will receive an additional Sh462 million in the year starting July to cater for a shortfall in budget after it was stopped from charging environmental impact assessment fees.
NCA will get Sh795 million more to cover costs that were previously met by a 0.5 per cent levy on the value of construction projects exceeding Sh5 million.
Treasury will allocate Sh1.25 billion for budget shortfall to the two agencies following the scrapping of the fees in 2016.
Taxpayers will fork out Sh1.3 billion to sustain environmental watchdog and a construction agency after the scrapping of construction levies that rich investors previously paid to the agency.
The National Environment Management Authority (Nema) will receive an additional Sh462 million in the year starting July to cater for a shortfall in budget after it was stopped from charging environmental impact assessment fees.
National Construction Authority will get Sh795 million more to cover costs that were previously met by a 0.5 per cent levy on the value of construction projects exceeding Sh5 million.
This means Treasury will allocate Sh1.25 billion for budget shortfall to the two agencies following the scrapping of the fees in 2016.
The Cabinet in November 2016 scrapped the fees paid to lower project costs and sharpen Kenya’s competitive edge.
Now, Nema’s and the construction regulator costs of evaluating fitness of construction projects have been transferred to taxpayers.
The agencies had pegged their budget on the levies, which stood at Sh1.5 billion in 2016.
Contractors used to pay a fee of between Sh10,000 and Sh40 million to Nema for environmental audits depending on the risk levels of their projects.
Parliament has criticised the scrapping of the construction levies, arguing it will expose taxpayers to a higher financial burden while cushioning wealthy investors.
“The scrapping of the environmental impact assessment fees, which used to be paid to Nema amounts to Wanjiku [taxpayers] subsidising the private sector,” the MPs said earlier in a report.
Private investors, through the Kenya Private Sector Alliance, had lobbied President Uhuru Kenyatta to abolish the charges.
The Mining ministry in 2014 started collecting a two per cent royalty on construction materials — increasing the cost of quarry stones, concrete blocks, hardcore, ballast and sand.
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