On a busy morning in Nairobi’s industrial area, a payroll officer scrolls through a spreadsheet that has become increasingly familiar to many Kenyan workers.
The numbers tell a quiet story: a salary that looks reasonable on paper, but shrinks noticeably once statutory deductions are applied.
By the time income tax, health contributions, pensions and the Affordable Housing Levy are deducted, what lands in the bank account often feels far removed from the promise of financial dignity.
Now, that same housing levy is at the centre of a government plan to raise about KSh 100 billion through securitisation—borrowing against future contributions from workers and employers. It is a proposal that officials say will speed up housing delivery, but one that is also deepening anxiety among workers and sharpening political divisions at the highest levels of government.
“I don’t see the reason why anyone privileged with a job today… a job that can be done by many others, will have issues contributing to a national scheme to help the less fortunate, starting with me as the president,” Ruto said at State House, Nairobi.
At stake is not just a financing model, but the emotional contract between citizens and a state that has promised them homes they can afford.
A promise of homes, a reality of deductions
The Affordable Housing Levy, set at 1.5 per cent of gross salary and matched by employers, was introduced as part of President William Ruto’s flagship housing agenda. The government says it is meant to turn monthly contributions into future home ownership opportunities for ordinary workers.
But for many salaried Kenyans, it has become another line on a payslip that reduces already stretched incomes.
“This is the first time in our history that ordinary workers can realistically aspire to own decent homes,” President Ruto said in earlier remarks defending the programme. “It is about jobs, dignity, and transforming lives.”
He has repeatedly framed criticism of the levy as resistance to reform. “We cannot build a nation on populist politics,” he said at one public event, insisting that the housing programme is already creating jobs in construction and related sectors.
But on the ground, the story is more complicated.
Inside the debate: ‘Workers are being squeezed’
Former Deputy President Rigathi Gachagua has emerged as one of the strongest political voices against the levy, turning what was once a policy debate into a question of household survival.
“Kenyan workers are being overburdened,” Gachagua said recently. “Between housing levy, SHA, NSSF and income tax, the payslip is no longer a symbol of hope. It is a reminder of how little is left.”
In his public rallies and interviews, Gachagua has increasingly linked the levy to broader economic strain, arguing that the government is taking too much from salaried workers while failing to provide equivalent relief on the cost of living.
“There was a time when a payslip meant dignity,” he said. “Now it is deductions upon deductions. You cannot build an economy by exhausting the worker.”
He has also promised that, should he gain political power in 2027, he would review or scrap the levy entirely—a position that has further politicised what was initially presented as a housing financing tool.
A new plan that raises new fears
The latest government proposal—to securitise future housing levy collections to raise KSh 100 billion upfront—has added another layer of concern.
Under the plan, investors would inject cash today, repaid over time through future salary deductions. In simple terms, workers would not just be contributing to housing—they would also be repaying a loan taken against their future contributions.
Officials argue this would accelerate construction and reduce delays in delivering housing units. A Treasury official, speaking cautiously, described it as “bringing forward resources that already belong to the housing programme so that Kenyans can benefit sooner.”
But economists and labour experts see it differently: a long-term financial commitment built directly on workers’ future earnings.
Between hope and uncertainty
For many Kenyans, the housing programme sits at an emotional crossroads. On one hand is the promise of home ownership—a powerful aspiration in a country where urban housing remains out of reach for many low- and middle-income earners.
On the other hand is the reality of shrinking paychecks and rising cost-of-living pressures.
Labour groups say the levy has reduced disposable income at a time when food, transport and rent costs remain high. Employers have also raised concerns that the additional payroll cost makes formal hiring more expensive, potentially slowing job creation.
Civil society organisations, meanwhile, are calling for clearer accountability on how housing funds are used and how beneficiaries are selected.
Courts, confusion and continuity
The debate has also played out in courtrooms, where petitioners have challenged the levy as unconstitutional and unfair. While early rulings temporarily halted its implementation, appellate courts later allowed deductions to continue pending final determination.
For now, the levy remains firmly embedded in monthly payslips—despite legal uncertainty and political disagreement.
A national conversation still unfolding
As Parliament prepares to examine the 2026/27 budget framework, the securitisation plan is expected to face intense scrutiny. Lawmakers, unions and political leaders are likely to weigh not only its financial logic but also its social cost.
“The 3% house levy is not a tax; it is a contribution. But every employed Kenyan has to participate. That’s why I am passing it into law.” Ruto said, speaking during the passage of the policy.
For President Ruto, the housing programme remains a defining pillar of his legacy project—an attempt to reimagine how Kenya builds and who gets to own a home.
“Kenyans who contribute to the housing levy are saluted for their sacrifices and commitment. Their money is transforming Kenya and affording houses for citizens who cannot currently afford them,” Ruto said while inspecting a housing project.
For Gachagua and other critics, it has become a symbol of a system that takes too much from workers and gives back too little certainty.
And for millions of salaried Kenyans watching their payslips shrink each month, the debate is less about policy and more about something far more personal: whether the promise of a home is worth the cost of getting there.
