New rules to guide public assets lease in cash hunt

Kenya started leasing resources such as vehicles as an alternative to asset acquisition in order to bridge prevailing resource gaps.
The government is working on new rules that will guide ministries, departments and agencies in leasing assets such as land in a bid to raise extra revenue.
Treasury says lack of a standardised leasing framework has resulted in inconsistencies in the practice across national agencies and county governments, reducing gains that are supposed to be realised from this model.
Kenya started leasing resources such as vehicles as an alternative to asset acquisition in order to bridge prevailing resource gaps. It extended the same practice to leasing out its own assets such as land and road reserves to investors for capital investments. Lack of uniform rules to guide the process has seen different State entities enter into lease arrangements using their own guidelines, which the Treasury now wants to abolish.
“The National Treasury, therefore, is in the process of developing a comprehensive leasing framework that will provide clear, standardised guidelines and processes for the leasing of government assets across all public sector entities,” says Treasury in the draft 2025 Budget Policy Statement.
The Treasury has been at the forefront in leasing through the vehicle-hiring model, which has helped the government address challenges such as fuel misuse, high maintenance costs and obsolescence of vehicles.
The programme has seen the State lease over 8,000 vehicles for critical public service including provision of vehicles to disciplined forces and workers with field operations as well as ambulances.
The State has also extended the same model to leasing out its assets such as land to private investors. For instance, the country, through the Agricultural Sector Transformation and Growth Strategy (2019 – 2029) wants to lease out underutilised public land to the private sector for commercial agriculture projects.
The Ministry of Agriculture and Livestock Development last year opened a search for investors to lease 21,000 acres of idle land belonging to the National Youth Service and Tana and Athi Rivers Development Authority for commercial agriculture in a bid to boost food security.
The leasing of the 21,000 acres is part of the land commercialisation initiative (LCI) that targets to lease up to 500,000 acres of idle land and attract at least Sh65 billion in agricultural investments.
Other parcels identified for the LCI include Egerton University where 200 acres have been set apart for an Agro-science Park, 10,000 acres at the Galana Kulalu Irrigation Scheme and 25,000 acres of Bura Irrigation scheme.
Tana Delta Irrigation Project has 10,000 acres for rice production while Kiambere in Embu County has 1000 acres for fruit and vegetable production.