146 firms bid to build roads under public-private model

Over 140 firms have expressed interest to build 5,000 kilometres of roads in partnership with the government. This is expected ease pressure on public coffers.

This is the first phase of the government’s plan to pave 10,000 kilometres of roads within the next five years which will be complete by June 2016.

Infrastructure principal secretary John Mosonik on Friday said that the tender had attracted an unprecedented 146 local and international bids.

Winning bidders will be required to finance, design, construct and maintain a road based on periodical payments by the government.

“This arrangement will ease pressure on the national budget and is a departure from the current situation where projects have been underfunded, resulting in pending bills and stalled projects,” Mr Mosonik said.

Sixty per cent of the bidders were international companies and consortium while the rest were local.

PRIORITY

The PS said that priority would be given to local firms that proved they have the technical and financial capacity to execute the projects.

With a growing national expenditure, ballooned by devolution and spiralling public wage bill, the government has adopted alternative financing for development projects such as Public Private Partnerships to cut reliance on the budget.

Under this arrangement, the government will negotiate for loans from banks and other financing institutions. The banks will pay the contractor after the project is complete and certified by the government.

“The government then will reimburse the banks over an agreed period and rate,” Mr Mosonik noted.

SIGN CONTRACTS

Requests for proposals, the ministry said, would be invited from the companies late next month or early October and contracts are expected to be signed before end of the December.

“The projects will be launched in the second week of January next year,” the PS added.

The second phase of the projects will be executed in the 2016/17 financial year.

A team has been set up in the ministry comprising officials from the Kenya National Highways Authority, Kenya Urban Roads Authority and the Kenya Rural Roads Authority which are the implementing agencies for the projects.