Cabinet backs data-driven plan to tame infrastructure overpricing
Cabinet noted that the adoption of the new pricing database will standardise cost data, making it easier to monitor projects, plan budgets, and maintain consistency across ministries.
Kenya’s Cabinet has approved a new framework that will overhaul how infrastructure projects are priced, in a move aimed at curbing exaggerated costs, enforcing transparency, and ensuring that public investments deliver better value for taxpayers.
The newly adopted Comprehensive Framework for Infrastructure Projects Pricing will introduce a structured, data-based system to guide the determination of construction and development costs across all government sectors.
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The decision follows years of concerns over inflated budgets, irregular pricing, and poor cost controls that have undermined accountability in infrastructure spending.
Under the plan, the Chief of Staff and Head of the Public Service will oversee the rollout through a Multi-Agency Technical Working Team.
The team has already created sector-specific pricing models, a uniform cost derivation method, and proposals to establish a National Infrastructure Pricing Database (NIPD), which will act as a reference point for all government agencies.
Cabinet observed that despite massive investments in roads, bridges, and other key infrastructure over the last two decades, Kenya has continued to face major cost inconsistencies and overruns.
These problems have been attributed to reliance on outdated costing methods that are based on precedent rather than actual market data or technical analysis.
The new framework will be anchored on the First Principles Approach (FPA), a model that breaks down project costs into individual components, such as labour, materials, and equipment and evaluates them based on current market realities.
The approach, which has been successfully applied in countries like the United Kingdom, Singapore, and Australia, aims to ensure that every project is accurately priced from the planning stage.
By shifting from guesswork to evidence-based cost estimation, the government expects to save up to 25 per cent in project costs.
This is seen as a major step toward strengthening fiscal discipline, preventing wastage, and improving the delivery of public infrastructure.
Cabinet noted that the adoption of the new pricing database will standardise cost data, making it easier to monitor projects, plan budgets, and maintain consistency across ministries.
It will also enhance transparency in procurement by ensuring that all project costs are subject to uniform, verifiable criteria.
The move is part of the government’s broader effort to optimise spending and ensure that public infrastructure investments are not only cost-efficient but also responsive to the country’s development needs.
The Cabinet affirmed its commitment to prudent financial management and emphasised that the framework will improve oversight, accountability, and the credibility of Kenya’s infrastructure sector.
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