Members of the National Assembly’s Departmental Committee on Trade, Industry, and Cooperatives have voiced strong concerns that the National Treasury is undermining crucial state projects by failing to release the necessary funds.
This accusation was brought to light during a tense meeting between the committee, chaired by Hon. James Gakuya (Embakasi North), and senior Treasury officials.
At the center of the controversy is the Treasury’s withholding of Sh218.5 billion meant for five state agencies under the Ministry of Cooperatives and Micro, Small, and Medium Enterprises (MSMEs).
These agencies include the State Departments of Investment Promotion, Industry, Trade, Cooperatives, and MSMEs.
Hon. Gakuya expressed his frustration, stating, “Our biggest concern as a committee is that the National Treasury has decided to kill industrialization and the manufacturing sector by starving the state departments of funds.”
Read also:Ruto Highlights Strengthened Kenya-China Relations During Beijing Visits
The committee’s vice chairperson, Hon. Marianne Kitany, also criticized the Treasury’s actions, questioning how the government expects to generate revenue without investing in key economic sectors.
“For the government to collect more revenue in the key sectors of the economy, it has to invest funds to spur growth in the various sectors. How do you project to get revenue when you are not investing?” she posed.
In response, Benard Ndungu, the Director General of Accounting Services at the National Treasury, explained that the shortfall in revenue and scarcity of cash resources has led to prioritization of certain expenditures over others.
He noted that the Treasury has had to prioritize public debt, security, salaries, counties, social programs such as education and health, and flagship development projects.
The committee was particularly concerned about several key projects that are now in jeopardy due to the Treasury’s failure to release funds.
Among these projects are the construction of six Export Promotion Zones (EPZ), which were allocated Sh3 billion last financial year, yet only Sh300 million has been released.
Additionally, Sh3.5 billion for the Coffee Cherry Fund remains undisbursed, despite Parliament’s allocation of Sh4 billion in the 2023/24 budget.
The modernization of Kenya Planters Cooperative Union (KPCU) warehouses is also at risk, with Sh350 million still pending, despite its allocation in the National Assembly’s Supplementary Budget II of 2023/2024.
