National Infrastructure Fund Bill 2026 Analyzed

The National Assembly recently published the National Infrastructure Fund Bill, 2026, sponsored by Leader of the Majority Party, Hon. Kimani Ichung’wah. The bill proposes the establishment of the National Infrastructure Fund (the Fund) and aims to provide a legal framework for its establishment, management, governance, and oversight.

Purpose of the Fund

The Fund is designed to establish a structured and sustainable mechanism for financing critical national development projects. It seeks to accelerate the development of national infrastructure while reducing reliance on public debt. The Fund intends to mobilize private capital and other non-traditional sources of infrastructure financing, including domestic institutional investors like pension funds and collective investment schemes. It also aims to strengthen Kenya’s capacity to structure and execute large infrastructure projects, focusing primarily on commercially viable investments capable of generating sustainable returns.

Governance

The Fund will be legally established and designed to operate under professional management and sound governance structures, ensuring efficiency, accountability, and financial discipline. The Board of Directors will reflect independence, professional competence, and institutional accountability. The Board will consist of a chairperson (an independent director), the Cabinet Secretary to the National Treasury or a designated representative, four additional independent directors, two directors with experience in development banking, and the Chief Executive Officer (an ex officio member). Board members will serve three-year terms, renewable once.

The governance framework emphasizes integrity, independence, and expertise, requiring substantial leadership experience and relevant professional qualifications for Board members while minimizing conflicts of interest. Independent directors, including those with development banking expertise, will be recruited through a competitive process and will enter into performance contracts with the Cabinet Secretary. The Board will be responsible for setting the Fund’s strategic direction, mobilizing resources, approving investments, overseeing risk management, establishing internal controls, approving budgets, and appointing the Chief Executive Officer.

Disqualifications on Appointment

The Bill outlines restrictions on who may be appointed as an independent director to ensure integrity and prevent conflicts of interest. Individuals with recent political affiliations, government employment, or those responsible for managing public resources or having conflicting professional interests are disqualified. These safeguards are designed to maintain an independent, objective, and professionally governed Board.

Project Preparation

All investment decisions will be supported by thorough feasibility studies and project evaluations. Each project will be assessed for technical feasibility, commercial viability, legal compliance, social impact, environmental sustainability, and value for money. These assessments are intended to ensure that investments are economically sound and aligned with national development priorities.

Government Support

The government may provide support measures, such as guarantees or letters of credit, to enhance the bankability of projects where appropriate. These measures are designed to reduce investment risks and attract private sector participation while adhering to public finance management laws. The Fund’s expenditure and commitments must not exceed its income, and surplus funds will be invested only in secure instruments, such as government securities.

Audit Reports

The Bill mandates strong mechanisms for transparency and accountability. The Board must keep financial records, establish an audit committee, prepare quarterly and annual reports, publish audited financial statements, and disclose key operational information.

Policy Perspective

The Bill is introduced at a time when the government is disposing of assets and privatizing state-owned entities. The Fund will ensure that proceeds from these transactions are ringfenced for intended purposes, including the development of infrastructure such as airports, seaports, electricity generation and distribution, water reservoirs, irrigation systems, national highways, and railway networks. This Fund aims to provide public confidence and enhance accountability.