The National Social Security Fund (NSSF) plans to invest billions of Kenyans' savings into constructing the Nairobi–Rironi–Mau Summit Highway if its joint bid with the China Road and Bridge Corporation (CRBC) is successful.
The planned construction of the road, expected to ease congestion and enhance trade and travel between Kenya and its neighbours in the west, comes amid public concerns over the use of pension funds for infrastructure development.
The project involves the development of a 175-kilometre stretch of road that links Nairobi to Mau Summit, a key segment of the Northern Corridor that connects Kenya to Uganda and other East African countries.
China Road and Bridge Corp. partnered with the NSSF, Kenya’s largest pension fund, to jointly bid for the project, according to a new disclosure by the Kenya National Highways Authority (KeNHA). The partnership marks a notable shift in public infrastructure financing by tapping into domestic pension assets for long-term development projects.
According to official records, the NSSF manages a portfolio worth Ksh477 billion (approximately $3.7 billion). Its involvement in the highway construction is part of the government's latest trend of mobilising local financial institutions to support large-scale government infrastructure projects.
In addition to the CRBC-NSSF bid, the government also acknowledged the receipt of a privately initiated proposal for the same project from Shandong Hi Speed Road & Bridge International Engineering Co., signalling competitive interest in the highway's construction that is set to ease congestion in the region.
Additionally, according to the Kenya National Highways Authority (KeNHA), the expansion of the road would help address several issues, including the long-standing traffic congestion and safety concerns arising from design issues, driver behaviour, and climatic conditions.
The project was announced in a notice, although questions remain regarding transparency, procurement procedures, and the broader implications of pension fund exposure to such high-capital ventures.
On April 30, President William Ruto defended the government’s mandatory deductions toward the national social savings scheme, primarily channelled through the NSSF, revealing that the government was targeting Ksh1 trillion in savings over the next two years.
The dualing of the Rironi-Mau Summit highway is expected to begin in the next two months to enhance the safety of travellers and facilitate easier and more effective movement of people and goods to and from the Rift Valley, Western, and Nyanza regions.
The dualing of the highway is part of the Nakuru-Nairobi highway construction that will be largely funded through a Public Private Partnership deal.
The development comes a month after he signed a deal with the Chinese government for the expansion of the highway. This is after it cancelled a similar deal with French contractors for dualing the highway.
Kenya's decision to end the agreement with the French contractors came after KeNHA officials revisited the terms and conditions of the multi-billion-shilling project.
KeNHA had requested changes in the agreement; however, the French contractors declined, forcing the government to ditch the deal, with the government forced to pay Ksh6.2 billion to the French contractors for prematurely terminating the agreement.
