Finance Committee backs NIF bill, acceeds to public calls for expanded parliamentary oversight and safeguards

Finance Committee backs NIF bill, acceeds to public calls for expanded parliamentary oversight and safeguards

The Departmental Committee on Finance and National Planning has thrown its weight behind a landmark move to reshape Kenya’s infrastructure landscape, recommending the establishment of the proposed National Infrastructure Fund (NIF).
The proposal, contained in the National Infrastructure Fund Bill, 2026 sponsored by the Leader of the Majority Party, aims to transition the country from debt-heavy public financing to a model that leverages private capital and non-traditional sources, such as pension funds and climate finance.
Following the conclusion of stakeholder and public engagements last week, the Committee’s report to the House tabled on Tuesday afternoon proposes stringent measures to safeguard the Fund from misappropriation. 
These measures, prompted by public concern, focus on strict governance and board composition. According to the Bill, the Fund will be managed by a Board of eight directors, including five independent members.
“These independent directors must be recruited through a transparent, competitive process and must meet the high integrity standards of Chapter Six of the Constitution,” the Chairperson of the Committee, Hon. Kuria Kimani, emphasized during the report's preparation.
The Committee also acceded to public calls for an expanded parliamentary role to enhance oversight. Lawmakers underscored the need for National Assembly authority over the Fund by amending Clauses 18 and 21, requiring parliamentary approval for both the investment plan and the investment policy.
To ensure independence and curb conflict of interest in the operations of the Fund, the Committee supported provisions that explicitly disqualify Individuals with active political party affiliations, former government employees (within five years of departure) and those holding personal service contracts with the Fund from serving as independent directors.
.
To entrench the tenets of the Public Finance Management (PFM) Act, the Committee strongly recommended that the Fund remains subject to the Act’s full requirements, including mandatory audits by the Auditor-General and regular reporting to the National Assembly.
In line with the Committee’s pledge to incorporate public feedback, the Committee addressed several critical issues raised during the participation exercise. 
These include constitutional compliance. For instance, in response to concerns from the Controller of Budget (OCoB) regarding withdrawal authorizations, the Committee acknowledged the need to align the Bill with Article 206(4) of the Constitution to ensure all fund exits are backed by law.
The Committee also stressed the necessity of defining “infrastructure” to clearly outline the scope of eligible projects. Currently, the Bill’s lack of specificity creates uncertainty on which projects will be prioritized. 
During public hearings, stakeholders stressed that clear definitions will align the Fund with national priorities and prevent the duplication or misallocation of resources.
Addressing concerns that the Bill might encroach on devolved functions, the Committee clarified that the legislation is not intended to affect the powers of County Governments under the Fourth Schedule. 
Consequently, the Committee recommended inserting a definition for “national infrastructure” in Clause 2 to provide necessary clarity. However, even as the Committee moves to clear the ambiguity, the lawmakers in their report supported the views of the Cabinet Secretary of the National Treasury, Hon. John Mbadi that the Fund would exclusively Fund commercially viable national projects. 
Notably, the Bill, which is currently in its Second Reading, originated from feedback received during public participation on Sessional Paper No. 3 of 2025 regarding the partial divestiture of Safaricom PLC. 
At the time, the public proposed that proceeds from the divestiture be ring-fenced in a public fund established by an Act of Parliament and dedicated exclusively to infrastructure development.
The Committee is expected to introduce its proposed amendments during the Committee of the Whole House stage later.