Driving License Special: Govt Multiplies Profits as Applications Drop Sharply

by Derrick Okubasu on Tuesday, 21 May 2024 - 5:53 pm

Hello and welcome to the Evening Brief Newsletter where we are tracking the Driving License Activity.

State Visit Update: Since touching down in Atlanta on Monday Evening, President William Ruto has met numerous organisations including Kenyans in the Diaspora. Key points emerging from the interactions are;

Signing of MoUs between CDC and Kenya Medical Research Institute, the Ministry of Health, and the U.S. President's Emergency Plan for the joint proclamation for the operationalisation of the Kenya National Public Health Institute.
Five Kenyan Universities will sign student exchange programme with their American counterparts.
CS Miano is set to sign a collaborative framework agreement with Coca Cola for a Ksh27 billion investment over the next five years committed to capacity and capability expansion. This will create Jobs, increase local sourcing and make Kenya a mango supply chain hub in Africa
Ruto's dedication to securing placement of Kenyans in employment abroad. He has signed a deal with Germany and 19 others are in the pipeline.

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DL Profiteering

Queries by the Departmental Committee on Transport and Infrastructure in the national assembly on Monday lifted the lid on the amount in profits the government reaps from processing the smart driving licenses.

The Committee was concerned that the National Treasury had only allocated Ksh140 million for the issuance of smart driving licence in the 2024/25 financial year.

The funds were expected to facilitate the processing of 400,000 driving licenses meaning that each DL costs Ksh350 to produce.

Burden to Applicants; Meanwhile, applying for a driving license through the eCitizen portal sets back applicants Ksh3,050

The new fee tripled the Ksh1,000 application and renewal fee drivers were expected to part with when applying for the old driving license.

A collage of a driving license issued in Kenya by NTSA

Photo

NTSA

Catch Up Quick: In recent months, the National Transport and Safety Authority has been running a campaign compelling Kenyan drivers to upgrade from the old driving licence to the smart version.

In April this year, the authority announced that it was determined to phase out all old driving licences within a period of three years. The smart DLs will allow the State to roll out instant fines and point systems to enforce traffic laws.
"This is critical to the integrity of road safety in the future, and will be accompanied by identity checks to eliminate identity fraud through the licensing system," NTSA stated in its National Road Safety Action Plan 2024-2028.
"With every Kenyan driver smart driver licence, it will be possible to administer and implement an instant fine regime and a demerit point system."

It is not clear if the Principal Secretary for the State Department for Transport Mohamed Daghar clarified that the budget will be reviewed upwards or downwards.

Waning Interest in Driving

Meanwhile, it seems the interest of Kenyans in getting behind the wheel is waning.

The Kenya National Bureau of Statistics (KNBS), in its 2024 Economic Survey Report released on Monday, indicated that 457,095 original driving licenses were processed in 2023 compared to 602,926 the year before.

The Difference: This means that the applications dropped by 145,831. Applications in 2021 stood at 384,004.

What the Report Said: "The number of PSV licenses issued doubled from 35,897 in 2022 to 71,980 in 2023. The number of original licenses issued declined by 22.5 per cent from 602,926 in 2022 to 467,095 in 2023. The number of driving license conversions nearly doubled from 1,542 in 2022 to 2,831 in 2023,"

Likely factors: In recent months, NTSA upped its ante in pushing Kenyan drivers to apply for new smart driving licenses.

However, the new DL attracts an application fee of Ksh3,050, which triples the previous Ksh1,000 drivers required to renew their old driving licenses.
Also, the state tightened its rules surrounding the existence of driving schools which saw 51 institutions shut down since 2019 leaving less schools on the market place.
The number of driving license applications is likely to drop further after the Finance Bill, 2024 proposed a motor vehicle tax requiring car owners to part with between Ksh5,000 and Ksh100,000 every year.

Of Note: Smart driving licenses were introduced in 2021 but implementation was heightened in 2023 as part of the government’s plan to ensure sanity on the roads and reduce carnage.

In comparison: KNBS data showed that PSV licenses doubled from 35,897 to 71,980 with 14-seater matatus leading the revolution.

By the Road Numbers: The severity of accidents also dropped.

KNBS indicated that the total number of reported traffic crashes was 9,960, a drop from 9,976 the year before. Whereas the number of persons injured or killed jumped up to 22, 885 from 21,758, those killed in crashes dropped from 4,690 to 4,324.

NTSA safety compliance checks at Kariene, Meru/Nkubu Road on March 31, 2024.

Photo

NTSA

Here are five other stories we are keeping tabs on for you today;

Deputy President Rigathi Gachagua explains that he was fasting in the forest and hence out of the limelight for seven days.
Several houses located along the Kenyan Coastline were destroyed and an unknown number of people displaced after cyclone Ialy hit the region.
The US Embassy denies funding President William Ruto's chartered flight to the United States for his State visit. The trip is estimated to cost Ksh200 million.
A state-owned company puts 1,377 plots of land in Bamburi (Kwa Bullo) on auction.
Hardly a week after economists and financial experts predicted that the Kenyan Shilling would fall further against the US Dollar, the value of the local currency dropped.