Some of the houses of officials in St Xavier’s area in Nakuru. [Julius Chepkwony, Standard]
Civil servants occupying government homes are expected to spend more on rent starting in April after the state announced a rate hike for the first time in 21 years.
The State Department of Housing has informed the Treasury that monthly rental income from all government residences will increase by 10% beginning in April.
The hike comes after Auditor General Nancy Gathungu slammed the Housing Department for failing to bring rent in line with current market rates as housing allowances for civil servants were repeatedly revised to reflect the cost of living. .
Housing and Urban Development Principal Secretary Charles Hinga said the review would still be “well below” the market rate because government housing is part of employer-subsidized housing for civil servants.
“Notice is hereby given that effective April 1, 2022, the rent for all Government Dwelling Houses will be increased by 10% of prevailing rates,” Mr Hinga said in a notice shared with the Treasury. .
An audit report for the year ended June 2020 showed that the total number of government housing units in the 47 counties stood at 56,892 with an annual rental potential of 1.52 billion shillings when fully busy.
A 10% increase means the state should receive an additional 152.5 million shillings, assuming the houses are fully occupied.
Hinga told The Standard yesterday that the main reason for the review was that ‘rent hasn’t increased since 2001’.
But the State Department will struggle to collect the rent unless it corrects the shortcomings pointed out by Ms Gathungu in her audit report.
The auditor general said the register of 56,892 houses maintained by the ministry did not contain key information such as occupancy and vacancy dates, details of occupants and reason for non-occupancy.
“Failing to keep a comprehensive record makes it difficult to track government and tenant housing for occupancy, home vacancy, homes with rent arrears, and their respective maintenance costs,” she said.
Collection deficit
The audit report showed rent collections from government houses amounted to 724.3 million shillings in the year ended June 2020 against an annual potential of 1.52 billion shillings.
He said the shortfall of 800.3 million shillings – 52% – was partly due to some civil servants not paying the required rent.
Gathungu’s report further showed that for houses occupied by county government staff, payroll deductions totaling 113.4 million shillings were made, but only 16.38 million shillings, or 14.4% , were handed over to the Ministry of Housing.
The Auditor General said the Housing Department had not put measures in place to ensure that all rental income due was collected in accordance with Rule 43(c) of the Public Financial Management (Government) Regulations 2015 national).
The regulations require an accounting officer to ensure that all aid credits due to a national government entity are collected and properly accounted for.
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