Sh11bn already paid to railway beneficiaries, land records show

Companies and individuals have raked in billions from land acquired by the government for construction of the standard gauge railway, according to the land commission’s figures.

The compensation scheme for land along the corridor from Mombasa to Nairobi has been subject of queries by the National Assembly’s Land Committee after the National Land Commission (NLC) transferred its mandate and billions set aside for the landowners to Kenya Railways, which is one of beneficiaries.

According to records held by the commission and Kenya Railways, Sh11 billion has so far been disbursed for properties acquired between 15 and 462 kilometres along the corridor, while compensation for the rest of the line is yet to be made.

In a letter to the Lands committee chaired by Tharaka MP Alex Mwiru, NLC Chairman Muhammad Swazuri defends the decision to hand over the compensation billions to Kenya Railways, which is one of the largest land owners to benefit from the payout, saying the law provides that beneficiaries be paid promptly but does not prescribe how.

Section 148 (4) of the NLC Act, stipulates that the duty to pay compensation under this section shall lie with the State department, county government, public authority or corporate body that applied for the public right of way and that duty shall be complied with promptly.

In his response, Dr Swazuri also said Kenya Railways is a State corporation with a fully-fledged finance department that is subject to government audit like any other.

“The enormity of the SGR project and the need to satisfy the constitutional provision on prompt payments necessitated the commission to delegate, on a supervisory basis, the disbursement of funds,” he said.

The NLC boss added that at the commencement of disbursement of funds for the project, his team had inadequate staff in the finance directorate to ensure an efficient payment function.

“We only had two members of staff in the finance department owing to lack of funds to recruit,” he said.

According to NLC, Kenya Railways owns 992 hectares of land where the SGR and the old railway line share the corridor, and could earn billions of shillings in compensation as government remains keen to complete one of its flagship projects.

According to a list of the top 20 recipients of the compensation funds, Voi Plantations Ltd leads the pack with Sh3.5 billion paid out to the company for 36 acres, including sisal plantations, treatment reservoirs and drainage network.

The firm is followed by Miritini Free Port, which gets Sh1.4 billion followed by Wallstreet Business Park Ltd at Sh1 billion.

Other large beneficiaries raking in hundreds of millions from the compensation scheme are East African Portland Cement Company Ltd, which is to receive Sh610 million.

Mr Charles Stephen Mbindyo is to get Sh430 million for his 112 acres, Kenya Ports Authority (Sh529 million) and NLC is also to receive a payout for 6.9 acres whose ownership is yet to be established.