Ksh1.6 Billion Chinese Loan That's Troubling Kenyatta University

  • Kenyatta University is in trouble over a Ksh1.6 Billion Chinese loan that has grounded the operations of Kenyatta University Teaching, Research and Referral Hospital (KUTRRH).

    According to the National Assembly’s Committee on Health, the failure by the Treasury to release the loan owed to the Chinese government has seen the facility lie idle, two years after the intended operational year (2016).

    "The project implementation was to take five years from 2011 at a cost of Ksh8.8 billion," stated Sabina Chege, who chairs the National Assembly’s Committee on Health.

    During the two-year delay, the warranty of the equipment has expired and repayment of the Chinese Exim Bank loan is due to start on September 21, 2018.

    In an inquiry report filed after visiting KUTRRH, the committee recommended that the Treasury should allocate Ksh1.6 billion through the supplementary budget for ratification by the National Assembly.

    "This will trigger the release of the undisbursed loan of Ksh1.37 billion for personnel and capacity building," Chege's team noted.

    The Referral Hospital, which also doubles as a training facility, is expected to ease the burden on Kenyatta National Hospital (KNH), Kiambu and Thika Level Five hospitals.

    The MPs noted that there was a failure to plan for the dry and soft run budgets, despite this being an obvious oncoming expenditure hence causing the current quagmire.

    Ksh 656,682,2017 is reportedly needed for dry run budget and Ksh 1,060,490,567 for the soft run of the Referral Hospital although the university is currently facing financial constraints.

    The National Assembly’s Committee on Health further indicated that the university had a sound plan, as confirmed by the Treasury, to run and manage the hospital.

    However, the original plan shifted to a public-private partnership (PPP) model after the Treasury declined to commit exchequer allocations citing fiscal challenges.