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Cabinet Secretaries and governors can now enjoy up to Kshs.40 million mortgage loans from a Kshs.1 billion revolving fund that will also serve top state officers.
Other senior state officers will be allowed to borrow between Kshs.25 million and Kshs.35 million depending on one’s rank.
National Treasury Cabinet Secretary Mr. Henry Rotich said the scheme became effective last month. The top officers allowed to borrow up to Kshs.40 million include governors, Cabinet Secretaries, the Chief of the Kenya Defence Forces and the Secretary to the Cabinet.


Principal Secretaries, members of independent commissions and holders of independent offices, including the auditor – general and the controller of budget, will be allowed to borrow up to Kshs.35 million.
The vice – commander of the Kenya Defence Forces, commanders of the Kenya Air Force and the Navy, the director-general of the National Intelligence Service, the inspector-general of police, the director of public prosecutions and deputy governors will be allowed to borrow up to Kshs.30 million.  The registrar of political parties, chief executives of state agencies, deputies of constitutional office holders and other state officers will be allowed to borrow up to Kshs.35 million.
The vice-commander of the Kenya Defence Forces, commanders of the Kenya Air Force and the Navy, the director-general of the National Intelligence Service, the inspector-general of police, the director of public prosecutions and deputy governors will be allowed to borrow up to Kshs.30 million.  The registrar of political parties, chief executives of state agencies, deputies of constitutional office holders and other state officers will be allowed to borrow up to Kshs.20 million.
However, members of Parliament and judges will not be eligible because they do not fall under the Executive.  Some state officers have started applying for the mortgage.  
“We have widened the range of access to accommodate all state officers”, said Mr. Rotich.  Civil servants under Job Group ‘S’ have their own scheme.
The Kshs.1 billion fund will be managed by the civil servants house mortgage scheme secretariat at Ardhi House and will be run through the Kenya Commercial Bank at the rate of three per cent a year.
“The funds are now available through the Ministry of Land, Housing and Urban Development and all state officers can have access on a first-come-first-served basis”, Mr. Rotich said.
Applications received after all the money has been lent out will wait until repayments have accumulated.
Mr. Rotich said he had delegated the responsibility of managing the fund to the Ministry of Land, Housing and Urban Development.
He said the funds have been long overdue despite having been proposed several years ago.  Last month, National Treasury Principal Secretary, Dr. Kamau Thugge issued new guidelines on the management of the mortgage scheme.
In a circular, Dr. Thugge said the instructions on the management of the scheme contained in the letter superseded those earlier issued on May 18.
The circular spelt out the procedure for accessing the loans through Kenya Commercial Bank.  Further, the regulations cushion the fund from risks, including those that may be occasioned by job losses by state officers holding political positions.
“Where a borrower ceases to be a state officer before full loan repayment, the advisory committee may in its discretion allow the borrower to continue to repay the loan at the same terms as set out in these regulations, provided that when the borrower defaults in a period of four months, the outstanding loan shall revert to prevailing commercial interests”, says the circular.
Those who resign from their jobs or leave on disciplinary grounds would also be given a four-month window to pay the balance of their outstanding loans, after which the prevailing market rates would automatically apply.
The mortgage scheme will run parallel with the public officers’ car loan scheme launched last month. The Kshs.1 billion car loan payable at three per cent allows civil servants of all cadres to receive between Kshs.600, 000 and Kshs.10 million.
However, officers in Job Groups such as C to G – who mostly earn less than Kshs.30, 000 – cannot afford the terms if they already have other loans.
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