Debts choking New KCC as state agencies yet to pay up Sh500 million
By Maureen Kinyanjui |
Compounding these issues, New KCC is also liable for Sh204 million it owes former employees who were laid off in 1997.
State-owned dairy agency, the New Kenya Cooperative Creameries (New KCC), is currently facing financial challenges, with debts surpassing Sh500 million, primarily owed by various government entities.
Records from the National Assembly Committee on Trade reveal that substantial amounts are owed to KCC, including Sh49 million from the Ministry of Defence. The Administration Police Service is also in arrears, with a debt of Sh32.38 million, while State House owes it Sh14 million. These outstanding payments are severely impacting the agency's cash flow.
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The situation worsens with additional debts, such as Sh3.07 million owed by the Office of the First Lady for milk supplies, and Kenyatta National Hospital (KNH), which has an outstanding balance of Sh10.53 million.
Furthermore, the private wing of KNH is responsible for Sh4.45 million in unpaid debts. The National Security Intelligence Service has incurred a debt of Sh4 million, and Nairobi Water and Sewerage Company owes New KCC Sh2.27 million.
Compounding these issues, New KCC is also liable for Sh204 million it owes former employees who were laid off in 1997 due to a long-standing legal dispute over compensation.
This alarming financial situation was highlighted during a recent committee sitting chaired by Embakasi North MP James Gakuya, who has been actively seeking answers regarding delayed payments to dairy and coffee farmers.
New KCC's Managing Director Samuel Ichura, along with Co-operatives Principal Secretary Patrick Kilemi, acknowledged that the unpaid debts from government agencies significantly hinder the company's financial stability.
"New KCC is failing to meet its obligations because of supporting government agencies. We need the help of this committee to pay the outstanding debt," Kilemi stated.
In light of these revelations, Gakuya proposed that New KCC should reconsider providing services to entities with outstanding debts, suggesting a re-evaluation of the agency's operational strategies to safeguard its financial health.
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