Members of the Trade, Industry and Cooperatives Committee have rejected a plan by the State Department of Investment Promotion to reallocate Sh200 million that had been appropriated to the Export Processing Zone Authority (EPZA).
Led by Chairperson Hon. James Gakuya (Embakasi North), the members today criticised the State Department for initiating the move to redistribute the funds without consulting the House team that oversees the ministry.
Investment Promotion PS Hassan Abubukar, while updating the MPs regarding the status of the flagship projects being implemented by the department, admitted that he had initiated the move after consulting with the National Treasury.
PS Abubakar informed the MPs that he had written a letter to the National Treasury seeking the redistribution of the Sh200 million that had been allocated to EPZA in Supplementary Budget 1 of the 2024/2025 fiscal year.
According to Mr Abubakar, he had suggested in his letter that Sh50 million be retained by EPZA, while Sh100 million should be allocated to the Kenya Investment Authority (KenInvest) and the remaining Sh50 million should go to the Special Economic Zones Authority (SEZA).
His revelation attracted sharp reactions from the lawmakers, with Hon. Gakuya and committee Vice-Chair Marianne Kitany (Aldai) noting that it is only Parliament that has the power to appropriate funds.
“There is no other entity apart from Parliament that appropriates funds to State departments. You ought to have consulted this committee first. There is absolutely no justification to bypass this committee,” said Hon. Gakuya.
Hon. Kitany explained that if the state agencies needed any funds, the correct process would have been for the state department to come to the House and request the same.
“If there is a need for any appropriation of money, state departments come to Parliament. If the request is not captured during the budget-making process, there is a window to ask for the same during the supplementary budget process,” explained Hon. Kitany.
In response to the concerns raised by the lawmakers, the PS acknowledged the anomaly of bypassing Parliament but noted that, as the accounting officer, he felt the move was for the common good of the state agencies.
“During Supplementary Budget 1, we requested money for KenInvest and SEZA, but the two entities that are in actual need did not receive the finances. I requested the reallocation to enable the two bodies to stay afloat and pay salaries for their staff,” he said.
“The good thing is that the cash has not yet been redistributed by the National Treasury. I will write to them and instruct that the cash be retained by EPZA,” added the PS.
Earlier, while updating the committee on the status of the EPZA flagship projects, the PS informed the MPs that the state department has prioritised the completion of 3 out of the initial 6 projects due to a lack of finances.
The 3 Export Processing Zones Hub projects, according to the PS, are located in Busia, Murang’a, and Uasin Gishu counties.
