Mismanagement of Co-operatives funds amid delayed audits sparks probe
Defending the cooperative movement, PS Patrick Kilemi said Kenya has over 7,000 registered financial cooperatives, ranking top in Africa and sixth globally.
A parliamentary committee has raised serious concerns about the legitimacy and management of two funds under the State Department for Co-operatives, citing governance gaps, delayed audits, and missing financial documents dating back years.
The National Assembly Special Funds Accounts Committee has now given the department a 14-day deadline to submit all outstanding audit records to the Auditor-General’s office, following a meeting on the Co-operative Societies Liquidation Fund and the Management Supervision Fund.
More To Read
- Kenya Forest Service under fire over irregular staff sackings, court lapses
- Governors reject audit of bursary funds in six counties
- Motorists demand full refund of road levies, say fuel price hike illegal
- NTSA yet to print 572,000 smart licences despite full delivery by supplier
- Sh540 million loss: Auditor General Nancy Gathungu exposes irregularities in book distribution
- EduAfya audit uncovers 'ghost students', Sh2.3 billion overpayment
Committee Chairperson Fatuma Zainab (Migori) led members in questioning the legality of the funds’ operations, with Principal Secretary Patrick Kilemi admitting that the funds do not have a Chief Executive Officer or Board.
Instead, they are managed through the audit section of the Commissioner’s office. “Are these funds? There is a structure stipulating what it takes to constitute a fund,” he stated, adding that the committee should evaluate whether the current structure meets the legal threshold.
Members of the committee pressed for more information on how the funds are run. Kivasu Nzioka (Mbooni) requested data on the number of SACCOs operating in Kenya, while Tom Odege (Nyatike) questioned their long-term benefit, saying many retired civil servants had lost their savings.
“Until today, they have not received anything,” he said.
Defending the cooperative movement, PS Kilemi said Kenya has over 7,000 registered financial cooperatives, ranking top in Africa and sixth globally.
“SACCOs finance 65 per cent of school fees in this country,” he noted, pointing out their important role in housing, education, investment, and transport.
He added that reforms were underway to strengthen oversight through legislative changes and new insurance regulations.
The committee also uncovered that the Co-operative Societies Liquidation Fund had not maintained separate accounts for nine years between 2004 and 2012.
Teso South MP Mary Emaase condemned the failure to file financial statements, blaming it on poor staffing. She criticised the quality of the finance and audit teams responsible, saying professionalism had been lacking.
Partial records related to the Management Supervision Fund were presented during the session, but the committee demanded full documentation.
Chairperson Fatuma directed the PS to submit all remaining documents within two weeks, stating, “We must uphold transparency and safeguard public funds.”
The committee is expected to compile a full report with its findings and recommendations, which will be tabled before the National Assembly.
Top Stories Today
