Inside Sh80B Landmark Deal to Transform Nairobi County

…as President Ruto and Governor Sakaja Assure: “This is Not a Takeover.”

STATE HOUSE, Nairobi – President William Ruto on Tuesday presided over the signing of a landmark Sh80 billion cooperation agreement between the National Government and the Nairobi City County Government, a comprehensive plan aimed at transforming the capital into a more liveable, secure, and efficient metropolis for its 4.4 million residents.

The historic pact outlines a joint framework for tackling key development priorities, including massive infrastructure upgrades, a revamp of waste management systems, expansion of urban mobility, and the strengthening of essential public services.

Amidst heightened political sensitivities surrounding the management of the capital, President Ruto moved swiftly to allay fears that the deal signals a federal takeover of devolved functions. He stressed that the arrangement is purely cooperative and financial in nature, designed to bolster, but not supplant the county authority.

What we are formalising today is not a transfer of functions. Let me repeat: there is no transfer of functions taking place. For the avoidance of doubt, I have no interest in running the city; my hands are already full. The Governor and his team must continue to run the city,” the President asserted.

“However, as President, I have an obligation to support and assist the capital city.”

To kickstart the agreement’s ambitious goals, Dr Ruto announced an immediate injection of funds to illuminate the city. The National Government is committing Sh3.7 billion to complete 10,000 unfinished streetlights and install 40,000 new ones across the metropolis.

He added that his administration through Kenya Power Company Limited, will invest Sh1.5 billion in transformers and last-mile connections in the informal settlements in the city.

Prime Cabinet Secretary Musalia Mudavadi (2nd right) on behalf of the National Government and Governor Johnson Sakaja (2nd left)for the County Government exchanged the signed documents. Looking on the far right is Attorney General Dorcas Oduor. Photo| PCU

Both leaders anchored the pact in Section 6 of the Urban Areas and Cities Act, which permits intergovernmental cooperation agreements for the management and development of urban areas, including the capital.

President Ruto further detailed the national government’s complementary financial commitments, beginning with a Sh2.1 billion investment in the Ng’ethu Water Treatment Plant to stem daily water losses of approximately 50 million litres. 

“Another Sh3 billion will go toward the Gigiri-Shauri Moyo evacuation corridor to stabilise and extend supply to high-demand zones,” Dr Ruto confirmed.

The partners also unveiled an ambitious environmental overhaul. This includes the construction of two parallel 27km trunk sewer networks along the Nairobi River Corridor for Sh9 billion, and a new Sh6 billion sewer plant capable of treating 60,000 cubic metres of wastewater daily. To widen access, last-mile sewer connectivity will receive a Sh3 billion boost, with a further Sh15 billion earmarked for long-term expansion across the city.

On the transport front, Sh8.7 billion has been allocated to complete the upgrading of roads, bridges, and drainage systems. The President explained that the government is mobilising an additional Sh1.7 billion for a second phase covering 59km of roads, set to begin in April 2026. 

He also emphasised a ward-level approach, detailing a Sh5 billion programme to improve roads in every constituency, complemented by Sh3.7 billion from the county government and an extra Sh1 billion dedicated specifically to drainage improvements.

“We are also allocating Sh4 billion to deal with solid waste management, including providing 100 acres of land for Material Recovery Facilities, while the National Government will provide Sh2 billion,” Dr Ruto stated, as he addressed the city’s chronic garbage problem.

On his part, Governor Sakaja hailed the moment as a long-overdue institutional shift in governance, as a constitutional and fiscal breakthrough. He drew a sharp distinction between this new framework and past interventions, notably the Nairobi Metropolitan Services (NMS) era. 

“This is not like an NMS takeover. That was a misadventure that left behind Sh16 billion in debt. This is not a transfer of function, but a cooperation that recognises Nairobi as the nation’s capital,” Sakaja asserted. 

He explained that the current financing of the capital is not sufficient, and this partnership is “a way to secure more funds, achieve more projects, and demonstrate that, 13 years later, the President has heard us.”

President William Ruto greeted the Nairobi County Governor Johnson Sakaja during the signing ceremony of the pact to transform the city at the State House Nairobi on Tuesday 18th February 2026. Photo Courtesy of PCU.

Ruto and Sakaja emphasised that the agreement strengthens coordination and financing alignment as mandated by Article 189 of the Constitution, which encourages intergovernmental collaboration while preserving county mandates. 

Earlier, the Nairobi Senator, Edwin Sifuna had cautioned Governor Sakaja against transferring functions to the National Government, reminding him of his earlier assurance to residents. He stressed the need for public involvement and adherence to the constitution, stating that any attempt to claw back devolution will be “strenuously resisted”.

To ensure accountability, all projects will be processed through lawful national and county budget mechanisms with strict oversight under public finance management laws. The deal also establishes a Joint Steering Committee and an Implementation Committee to guarantee structured oversight and measurable outcomes.

President Ruto concluded by framing the initiative as a national project, stating, “All these efforts will strengthen Nairobi’s standing as a globally-respected African metropolis that reflects our national ambitions.”

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