Kakamega Governor Fernandes Barasa has revealed plans to submit a memorandum to President William Ruto seeking a waiver of debts owed by Mumias Sugar Company.
This follows a Cabinet resolution dated October, 9,2023 which will see five state millers leased to private investors and their cumulative debt amounting to Sh117B written off.
“The debt owed by Mumias Sugar is Sh33B and as the sugar champion in LREB, we will submit a memorandum to President William Ruto to ensure the debts are written off,” Governor Barasa said.
Barasa was speaking during a public engagement forum at St. Joseph's Lusumu Primary School in Navakholo Constituency.
The government is working on waiving tax penalties and interest within 30 days as approved in the Cabinet.
“We also want the President to consider identifying a suitable investor who will revive the company. Currently, residents who used to depend on the company are suffering,” he said.
The plan to revive the five state millers will see the factories and land leased to bidders picked to commercially run Nzoia, South Nyanza, Chemelil, Muhoroni and Miwani sugar companies.
Speaking during the Cabinet meeting at Kisumu State Lodge, Treasury CS Njuguna Ndun’gu clarified that the proposed lease model will be executed by unbundling the nucleus estate land.
“The sugar companies owe the money in bank loans, tax arrears and penalties, farmers and employees dues. They owe banks Sh65million, Sh50 billion in taxes and nearly Sh2billion in farmers’ dues,” the memo reads.
Further, the requests for proposals for leasing will be published in two weeks, and payment of farmers’ arrears to be unveiled in three months.
“That the total of Sh65, 778,448,646 owed to the Government of Kenya and Kenya Sugar Board as of June 30, 2023, by the five sugar companies be written off,” CS Ndung’u said.
The Cabinet dispatch further noted that a payment plan for balances owed to farmers amounting to Sh1.715,129,404 be worked out by the Ministry of Agriculture and Livestock Development and the National Treasury.
