This archive report was first published on 21 November 2019.
On November 20, 2019, Kenya's Treasury announced that it had collected Sh66 billion in dividends and retained earnings from state corporations, exceeding its target of Sh78 billion.
According to Ukur Yatani, the acting finance minister, state companies had not been remitting their dividends at the end of every financial year as required by law. However, he denied domestic reports that the move to take the cash would starve the banking sector of liquidity.
“These are just surplus funds. Their operational accounts and all other matters have not been touched,” Yatani told Reuters, adding that the extra cash would be spent on development projects.
Kenya Ports Authority (KPA) was among the top state-owned entities to remit money to the government, sending Sh18.7 billion to the treasury. KPA joined Kenya Pipeline Company, which returned Sh5 billion, and the Kenya Airports Authority (KAA), which remitted Sh12 billion.
The Treasury has directed parastatals to stop re-directing surplus funds to projects before they get approvals, following regulations published in 2018 that demand parastatals to remit reasonable returns to shareholders.
Regulators, on the other hand, are required to remit 90 per cent of their net surplus.
