State corporations and other government agencies owe the national government an estimated KSh.800 billion in loans.
According to last year’s budget estimates, the monies were given to 72 organisations as at June 30, 2018 as loans but only KSh.69B was repaid.
The list of heavy state borrowers actively servicing their loans includes Kenya Railways, having received a total of KSh.473B; whose huge chunk went into the construction of the standard gauge railway line from Mombasa to Nairobi.
Electricity producer, KenGen has a debt of KSh.108B, being part of government efforts to increase power generation in the country, Kenya Airports Authority owes KSh.930 million.
Struggling Mumias Sugar Company owes the State KSh2.5B which it is not able to pay, according to the report.
Out of the total monies lent to 29 of these corporations, the government has to deal with KSh116.8 million non-performing loans.
The government has however written off KSh27B off its total amount of KSh869B given out debt following a cabinet approval in May last year. Only KSh638B is being actively serviced.
Water services boards are notorious defaulters as Athi Water Services Board leads the pack on bad debts at KSh39.1B, while Lake Victoria South Water Services Board comes second owing KSh13.1B.
In May 2018, the government wrote off of bad debts to 21 organisations, amounting to KSh27.2B.
Coffee Board of Kenya and the collapsed Pyrethrum Board of Kenya were the main beneficiraies of the government decision.
Despite incessant agitation, none of the five state-owned sugar millers slated for privatisation had their debts cancelled; a factor that negates efforts to reform the sugar industry in the country.
Interestingly, banking institutions also feature among the borrowers, with Equity Bank and Cooperative Bank actively repaying loans of KSh468 million and KSh476 million respectively.
The government acknowledges that total monies lent increased by 70% to KSh868.9B, which government borrowed on behalf of various agencies undertaking key projects in the country.
