The Kenya Kwanza administration is seeking to introduce toll stations on new and upgraded roads, as well as two-lane roads, using private operators to generate up to Sh4.8 trillion.
Dubbed the Road Toll Policy, it is aimed at generating revenue beyond the national budget’s constraints.
The government plans to spend Sh1.9 trillion annually on road development and another Sh1.1 trillion on maintenance, with tolling seen as a critical revenue stream to cover these costs.
“There exists an outstanding maintenance backlog estimated at Sh500 billion, considering the damages caused by the recent El Niño rains and the current extreme floods,” the Road Toll policy states, adding, “Other taxes and charges paid by road users are not specifically allocated to the roads sub-sector. Road tolling should, therefore, provide a solution to the funding gap, provided a road tolling policy is established.”
The government, already facing backlash over tax hikes, is asking Kenyans to shoulder an additional financial burden. The proposal is coming at a time when companies are making huge losses, fuelling concerns over job losses, with more than 5,500 employees laid off by over 57 companies in recent months.
READ: Why you may not escape paying toll fees on major roads and highways
“The projected financial gap from the ongoing road sub-sector study reports a deficit of Sh1.8 trillion and 4.0 trillion for the 5-year and 10-year planning periods, respectively, for the development, maintenance, and rehabilitation of roads,” the policy explains.
Touted as a solution to road maintenance funding, the toll policy published in February is part of a broader revenue-raising strategy, which promises to increase fuel levies, new toll charges, the introduction of a “polluter pays” principle, and an insurance premiums tax to bridge a Sh500 billion maintenance backlog.
“This policy aims to replicate these benefits of tolling as a solution to meeting the funding shortfall in road development, maintenance, and rehabilitation,” the policy by the Transport Ministry explains.
The policy is now undergoing public participation, although critics say that county commissioners — who are overseeing the process — are favouring government-friendly groups to rubber-stamp the process.
Under this plan, the policy with all the features resembling the controversial Adani-style or SHA-inspired model could see private firms take over toll collection as early as the next financial year. The policy would grant the Transport Cabinet Secretary control over pricing, while private firms managing toll stations would dictate fines and additional levies.
Joseph Mbugua, Principal Secretary State Department of Roads, says the government faces a funding gap for road development, maintenance and rehabilitation.
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“The government has therefore developed this policy, which is aimed at guiding levying tolls under the ‘user pay principle,’ in which charges are levied for access and use of the road toll infrastructure,” Mbugua said.
Fuel levies
And just like the Adani JKIA takeover deal or the SHA/SHIF, the road toll policy deals in privatisation, reduced oversight, and financial burdens.
Both policies create independent revenue streams with minimal State control and increasing transport costs, much like SHIF’s impact on healthcare. Rising electricity tariffs under Adani’s energy deals highlight privatisation risks.
Political influence and corruption fears persist, with select firms benefiting from non-competitive contracts. Linking toll fees to insurance renewals mirrors Adani’s regulatory advantages. Both policies risk higher costs and less transparency.
“While a private toll collector would focus on profit, the State-owned National Tolling Authority/Directorate would prioritise customer service and efficient delivery,” the policy states.
“Kenya has not implemented user charges for economic infrastructure. Roads should be funded through fuel levies and tolls where viable, ensuring passenger and freight transport operate commercially under the ‘user pays’ principle,” Transport CS Davis Chirchir states in the policy.
Under the plan, private entities would manage a dedicated fund for toll revenue, bypassing government oversight and reducing public transparency over financial arrangements. The scheme effectively diverts money from State coffers to private firms while avoiding taxpayer scrutiny in a major national infrastructure project.
Toll charges will not be limited to newly constructed roads. Existing two-lane roads and even repaired or upgraded roads will be tolled, with some already in use slated for toll booth installations. This is expected to significantly increase transportation costs, disproportionately affecting small businesses and low-income workers who rely on road transport for commuting and trade.
“Private Toll Operator: This policy proposes an alternative approach—engaging a Private Toll Operator through a government procurement framework. The National Tolling Authority/Directorate or a relevant entity may outsource a private operator to manage certain toll road networks,” the policy states.
Documents reviewed by The Standard reveal that officials are aware of the public backlash the tolling system will provoke but insist that toll collection is necessary to address a growing funding gap in the road sector.
The policy introduces penalties for toll evasion, including a fine of Sh50,000, a six-month jail term, or both.
The Roads Maintenance Levy Fund (RMLF), currently used for road repairs, is expected to generate Sh100 billion in FY 2024/2025—far short of the Sh253.5 billion required for adequate road maintenance.
The tolling policy is designed to supplement the RMLF, filling this financial gap while funding new infrastructure projects.
A key element of the plan is the creation of a National Tolling Authority, which will oversee toll collection independently of the Kenya Roads Board (KRB) and the National Transport and Safety Authority (NTSA). Private companies will be contracted to operate toll stations, with full autonomy over toll rates. Revenue collected will be deposited into a separate Toll Fund.
The policy acknowledges the risk of widespread toll evasion, a challenge that has plagued similar systems globally. Until Kenya establishes a fully functional tolling infrastructure, physical barriers at toll stations will be used to enforce payments, though this approach is seen as costly and inefficient.
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“The report notes that fuel levy collection fluctuates annually based on fuel consumption. While the ideal RMLF collection target by KRB is Sh132 billion, the study estimates that road network maintenance requires Sh253.5 billion,” the report states.
Tolling Authority
The policy classifies vehicles into categories—motorcycles, rickshaws, passenger cars, 4WDs, pick-ups, minibuses (matatus), small buses, light and medium trucks, large buses, heavy trucks, and articulated trucks—which will dictate the amount to be set by a CS for a vehicle to pay for tolling. These classifications will be periodically reviewed to reflect technological advancements and evolving traffic needs.
“The agency responsible for a toll road or the National Tolling Authority may outsource toll collection to the best value private operator, taking into account the efficiency and value for money of the toll collection network across Kenya and to create a competitive market in Kenya for toll operation,” the report says.
To ensure that road users cooperate with toll operators, the government is also considering legal amendments to criminalise toll evasion.
The changed laws will also allow toll operators to recover unpaid fees outside the court system.
One proposal seeks to link toll payments to vehicle insurance renewal, requiring motorists to clear outstanding toll fees before renewing insurance policies.
This would necessitate amending the Insurance (Motor Vehicles Third Party Risks) Act.
