Special Funds Committee questions legality of Cooperative Department Funds
While the Management Supervision Fund had only partial documentation presented, Zainab insisted the PS deliver all outstanding documents within two weeks.
Parliament’s Special Funds Accounts Committee. Parliament of Kenya.
By Robert Assad
Parliament’s Special Funds Accounts Committee on Tuesday directed the State Department for Co-operatives to submit missing audit records within 14 days, raising concerns over the governance of the Cooperative Societies Liquidation Fund and the Management Supervision Fund, July 22, 2025.
Committee Chairperson Fatuma Zainab of Migori led the inquiry, questioning the structural legitimacy of the two funds after Principal Secretary Patrick Kilemi acknowledged they operate without a CEO or board, instead managed under the audit section of the Commissioner’s office.
“Are these really funds? There is a structure stipulating what it takes to constitute a fund,” Kilemi told lawmakers. He deferred to the Committee to decide whether the current structure met legal standards.
Legislators, including Hon. Kivasu Nzioka of Mbooni and Hon. Tom Odege of Nyatike, voiced skepticism. Nzioka sought a national tally of SACCOs, while Odege highlighted cases where civil servants retired without receiving expected payouts, despite years of saving.
Kilemi defended the sector, stating Kenya is home to more than 7,000 financial cooperatives, ranking first in Africa and sixth globally. “SACCOs finance 65% of school fees in this country,” he said, emphasizing their importance in education, housing, and investment. He added that reforms and insurance regulation efforts are underway to strengthen oversight.
The Committee also learned that the Liquidation Fund failed to maintain separate accounts between 2004 and 2012. Hon. Mary Emaase of Teso South criticized the delayed financial reporting and called out inadequate professionalism among former audit and finance personnel.
While the Management Supervision Fund had only partial documentation presented, Zainab insisted the PS deliver all outstanding documents within two weeks. “We must uphold transparency and safeguard public funds,” she said.
A full report on the findings and recommendations will be tabled in the National Assembly.
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