Committee Calls on New KCC to Cease Milk Supplies to Defaulting Government Agencies
“New KCC is struggling to fulfill its obligations due to the financial strain caused by supporting government agencies.
The Committee on Trade, Industry, and Cooperatives has urged the New Kenya Co-operative Creameries (New KCC) to stop supplying milk to government agencies that have failed to clear their outstanding debts.
Hon. James Gakuya, the Committee Chairperson and Member of Parliament for Embakasi North, stressed that New KCC, as a business entity, should not allow its operations to be compromised by government bodies with significant arrears, as this affects the company’s capacity to compensate farmers.
“New KCC is a business, and you are not obligated to continue supplying milk to government agencies that still owe you money. You can’t expect farmers to understand why they haven’t been paid simply because government bodies haven’t settled their debts,” said Hon. Gakuya during a meeting with Cooperatives Principal Secretary (PS) Patrick Kilemi.
During the meeting, PS Kilemi, accompanied by acting New KCC Managing Director Samuel Ichura, disclosed that the milk processor is owed Ksh184.3 million by various government ministries. The Ministry of Defence and the Administration Police Service are the largest debtors, owing Ksh49.49 million and Ksh32.38 million, respectively.
Other notable debts include Ksh14.62 million owed by State House, Ksh10.53 million by Kenyatta National Hospital, and Ksh6.79 million by The Presidency. Additional debts include Ksh4.45 million by the Kenyatta National Hospital Private Wing, Ksh4.04 million by Moi Teaching and Referral Hospital, Ksh4 million by the National Security Intelligence Service, Ksh3.07 million by the Office of the First Lady, and Ksh2.27 million by Nairobi Water and Sewerage Company. An additional Ksh52.24 million is owed by other government agencies.
“New KCC is struggling to fulfill its obligations due to the financial strain caused by supporting government agencies. We need this committee’s support to ensure that the outstanding debts are settled,” PS Kilemi stated during the session, which was also attended by New Kenya Planters Cooperative Union (New KPCU) Managing Director Timothy Mirugi.
The meeting was convened in response to a statement requested by Hon. Eric Muchangi (Runyenjes) concerning delayed payments to dairy and coffee farmers by various cooperatives in Embu County.
PS Kilemi acknowledged past delays in payments to dairy and coffee farmers but reassured the committee that payments are now up to date until June. He confirmed that the remaining payments would be completed by the end of the month.
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