A KHCR report has labelled Hustler Fund structurally flawed, economically unsound, and a politically motivated initiative that has failed to empower the citizens it was meant to uplift.
MPs have cast doubts over the recoverability of the Sh12.6 billion advanced to Kenyans under the Hustler Fund programme as demands for a special audit emerged amid fiscal indiscipline issues over the safeguards employed by the State disbursement of the funds.
The suspected loss of the funds came as the members of the Special Funds Accounts Committee of the National Assembly summoned the Cooperatives and Micro, Small, and Medium Enterprises (MSMEs) Cabinet Secretary Wycliffe Oparanya and Principal Secretary Susan Mangeni to account for the operations of the fund.
The House committee, chaired by Migori Woman Representative Fatuma Mohammed, made the demand to have CS Oparanya and the PS after Hustler Fund CEO Mr Henry Tanui told the MPs that out of the Sh14 billion allocated to the fund, only Sh1.4 billion was revolving.
“Appearing here with no query answered is a mockery to the committee. This is an oversight committee. When you say no money was lost, I think you do not live in this country,” said Ms Mohammed.
According to fiscal experts at the Parliamentary Budget Office (PBO), the Sh12.6 billion is enough to construct at least 12 kilometres of the Sh170-Sh200 billion- Rironi- Mau Summit Road at a cost of about Sh1 billion a kilometre.
With capitation funding issues in secondary school hitting Kenyans, the Sh12.6 billion is enough to finance the education of 566,000 learners based on the government’s current capitation rate of Sh22,240 per learner.
Queries
Key among the issues MPs wanted answered was the exact amount of money that had been loaned out and how much had been paid back since the inception of the Fund and whether any money had been lost.
However, the committee session took a twist after Mr Tanui failed to satisfactorily answer the query, only telling the MPs that no money had been lost and could not provide documents containing details of the funds’ beneficiaries against the committee’s direction.
The CEO’s failure to address the MPs’ concerns saw North Imenti MP Rahim Dawood demand that the committee sanction a special audit of the Hustler Fund by Auditor-General Nancy Gathungu.
Mr Dawood decried that the committee’s continuous requests to have documents detailing the beneficiaries of the billions submitted before it had been ignored.
“The press even reports that of the people who took the loans of the Hustler Fund, many are not known, and cannot be followed up. That's why I say this money has been misappropriated. It has been lost. And if you cannot recover it, what is the point?” the Imenti North MP posed.
North Imenti MP Rahim Dawood.
He added, “I would suggest, besides what we have done here, we should order a special audit of the Fund,” said the second-term MP.
The lawmaker went on to claim that the frequent changes to the board of the Fund and the position of the CEO were meant to mask all the illegalities going on.
“If you only have Sh1.4 billion rotating, do you have the other Sh12 billion in your accounts? Because it seems the Hustler Fund, to hide things, removes people from the office. After three or six months, you will be gone, and somebody else will come. And I think that is what is happening,” added Mr Dawood.
Mwingi West MP Charles Nguna admitted to knowing individuals who took the Hustler Fund loans with no intent of ever repaying the amount and was worried that the government was not doing enough to recoup the money, which could ultimately get lost.
“Let's just call a spade a spade. If the Treasury has allocated you Sh14 billion so far and only Sh1.4 billion is revolving, then we can say that the money is lost,” Mr Nguna said.
"I personally know of people who registered new lines to access the loans but they have since blocked the numbers and don’t plan on repaying the same.”
“So, I just want to confirm these fears, we have lost the taxpayers’ money”.
But Mr Tanui maintained that no money had been lost and that because he was new in office, he needed time to submit the requested documents.
“Members, money borrowed is not money stolen. Some of these funds are with your constituents and what I have done is put in place measures to recoup the money,” said Mr Tanui, but without stating the measures he had employed to recover the loaned funds.
The CEO also explained that the registration of individuals to access the loans was pegged on their Identity card numbers and that all the beneficiaries are known to the committee chairperson, ruling that he submits the list of the borrowers with their contacts and identification within seven days.
“We want all the documents that show what a person has borrowed. Right now, we are working with speculation, which is not good for the committee and not good for the Hustler Fund,” said Ms Mohammed.
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