- CS Yatani says the claims are unfounded.
- He termed the SGR loan as sovereign loan that requires Parliament's approval before any payment is done.
Image: EZEKIEL AMING'A
Queries on servicing of standard gauge railway loans emerged during a House committee meeting on the planned merger of Kenya Ports Authority, Kenya Railways Corporation and Kenya Pipeline Company.
Members of the National Assembly Finance Committee raised queries on the cooperation between the three agencies, with some lawmakers claiming it is a backdoor plan to plough cash from other profit-making government agencies to service SGR loans.
Luanda MP Christopher Omulele and his Tetu counterpart James Gichuhi on Wednesday told Treasury Cabinet Secretary Ukur Yatani to clear the allegations that the deal is meant to subsidise the huge SGR loans.
“I think what you are trying with this merger plans is to have a situation where Kenya Ports Authority can be used to service the huge SGR loans,” Omulele said.
But Yatani dismissed the allegations as untrue, terming the SGR loans as sovereign loan that requires Parliament's approval before any payment is done.
He, however, defended the move to amalgamate the three entities, saying cooperation will lead to efficiency and will cut on operation cost as they will have common departments like human resource and legal departments.
“The notion that we want to subsidise payment of SGR loans is not the case. Ultimately, you are the ones who give authority for payment of loans,” Yatani said.
The government made the first instalment of the Sh324 billion SGR loan early this year. The government had in the past exuded confidence that the country would be able to pay back the loan from the revenue generated from SGR services.
Yatani appeared before the National Assembly Finance Committee chaired by Homa Bay Woman Representative Gladys Wanga to appraise the committee on the preliminary preparations on the merger of KR and KPC under the coordination of the Industrial and Commercial Development Corporation.
The CS assured the lawmakers that there will be no job losses as a result of the integration of the state agencies.
“We want to confirm that there will be no loss of jobs. The efficiency of the system will lead to creation of more jobs.”
Yatani told Parliament that the entities signed a framework agreement on September 8 that spells out the common and clear principles to guide co-operation.
Edited by Henry Makori