Government Denies Claims It Plans to Use SACCO Funds for Infrastructure Projects

By Our Reporter Maurice Momanyi

The Ministry of Co-operatives and Micro, Small and Medium Enterprises (MSMEs) Development has dismissed as false reports alleging that the government intends to use over KSh1 trillion held in Savings and Credit Cooperative Societies (SACCOs) to finance major public infrastructure projects.

In a press statement issued on Monday, Principal Secretary for the State Department for Co-operatives, Patrick K. Kilemi, termed as misleading a report aired by NTV Prime News on July 4, saying it had the potential to cause unnecessary panic among millions of Kenyans who rely on SACCOs for savings, credit and other financial services.

The Ministry clarified that during the Ushirika Day celebrations on July 4, Deputy President Kithure Kindiki informed cooperators that the proposed National Infrastructure Fund had secured seed capital amounting to KSh345 billion from the proceeds of the sale of government shares in Kenya Pipeline Company and Safaricom.

According to the Ministry, the fund is intended to create fiscal space in the national budget by financing selected infrastructure projects, allowing more public resources to be directed towards priority sectors, including the cooperative movement.

The Ministry emphasized that at no point did the government propose using SACCO deposits to finance the infrastructure projects.

It further stressed that SACCO funds remain the property of individual cooperative societies and are managed exclusively by their elected leadership, adding that the government neither has access to nor intends to utilize members’ deposits.

“The Government has no access to, and does not intend to utilize, member deposits held in SACCOs since cooperatives are autonomous, member-owned institutions,” the statement said.

The Ministry noted that cooperative funds are strictly used to provide affordable credit and other financial services to members, in line with the cooperative movement’s principles.

It also called on media houses to exercise accuracy and professionalism when reporting on issues affecting the cooperative sector, warning that inaccurate reporting could undermine public confidence in SACCOs, which play a critical role in Kenya’s financial inclusion and economic empowerment.

The Ministry has demanded that Nation Media Group retract the report, issue an apology and publish a corrective statement with the same prominence as the original broadcast.