NCA unlikely to recover Sh1.6 bn arrears owed by developers


Real estate developers owed the National Construction Authority (NCA) Sh1.6 billion in fees that are unlikely to be recovered after they were scrapped last year.

Auditor-General Edward Ouko, in the latest audit report on the NCA books tabled in Parliament, says the agency was owed Sh1,644,891,596 as at June 2016. 

This follows a Cabinet memo in November 2016 that scrapped all construction levies charged by State agencies and counties in a bid to lower project costs.

Mr Ouko said the balance increased from Sh404,902,060 in 2014/2015 to Sh1,644,891,596 as at June 30, 2016, with government institutions owing the largest portion.

In the report tabled before Parliament went on an indefinite end-of-term recess, Mr Ouko said the NCA did not provide a plan for audit review on how it intends to recover the money.

Contractors pay environmental audit fees of between Sh10,000 and Sh40 million, depending on the risk levels of their projects.

Developers whose projects exceed Sh5 million also pay a 0.5 per cent levy of the value of the contract to the NCA before they can begin work.

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