28/08/2026
UNDERSTANDING HOW NG-CDF FUNDS ARE USED
NGCDF is a statutory public fund with specific purposes, procedures, eligible projects, limits and accountability requirements.
The current framework is principally the National Government Constituencies Development Fund Act, 2015, as amended in 2023
There have been various claims and misconceptions about how NG-CDF funds are managed and spent. It is important for the public to understand the process.
1️⃣ BUDGETING & PROJECT IDENTIFICATION
As per the requirements, once funds are received in the Constituency they are budgeted for as follows:
✅Office & Administration (6%)
✅Monitoring & Evaluation (3%)
✅Climate Change (5%)
✅Emergencies and uncertainties (5%)
✅ Bursary , Education & Security Infrastructure (81%)
Projects are identified through the prescribed constituency processes and included in the constituency's annual project proposals and budget. The allocation is then submitted through the required NG-CDF processes.
2️⃣ BOARD APPROVAL
Projects cannot simply be created or funded at the discretion of an MP. The proposed projects go through the NG-CDF system and must receive the required approval from the NG-CDF Board before funds are released for implementation.
3️⃣ PROCUREMENT & TENDERING
Once a project is approved and funds are available, the project goes through the public procurement and tendering process. Qualified contractors submit bids, which are evaluated in accordance with procurement law before the successful contractor is awarded the contract.
4️⃣ PROJECT IMPLEMENTATION & SUPERVISION
After the contract is signed, the contractor undertakes the work according to the approved designs, specifications and Bill of Quantities (BOQ). The Project Management Committee (PMC), together with the relevant technical officers, monitors the project, while the appointed technical personnel supervise and certify the actual work done.
5️⃣ PAYMENT OF CONTRACTORS
A contractor is not simply handed the entire project amount. Payments are made progressively per milestones based on work actually completed and certified by the authorised technical/project officers. The required documentation, inspections and financial approvals must be completed before payment.
Applicable taxes, statutory deductions and contractual retention are also taken into account before the contractor receives the net payment. Retention provides protection in case defects have to be rectified after completion.
For instance:
In the case of Iruma Primary school.
Project: Renovation of Five(5) classrooms.
Project cost: 2.5 Million.
Budget breakdown
✅Project management committee -PMC (2%): KSh 50,000
✅Retention held (5%): KSh 122,366
✅VAT withholding to KRA(16%): KSh 400,000
✅Income WHT to KRA(3%): KSh 73,420
✅Contractor net payment: KSh 1,904,214
Cost per classroom (5) =Kshs 380,842.80
6️⃣ COMPLETION, INSPECTION & HANDOVER
Once the project is completed, it is inspected and certified before handover. The contractor remains responsible for defects in accordance with the contract and the applicable defects-liability provisions.
