The government has released another Sh 239 million to Mumias Sugar in the company’s ongoing bailout arrangement.
According to Mumias East MP Benjamin Washiali, Treasury gave out the money last week to help the cash-strapped firm remain afloat.
“We call upon the management to direct the funds into offsetting millions of shillings owed to farmers for cane deliveries,” Washiali told The Standard on phone Tuesday.
Cane growers had earlier asked the Jubilee administration to clear Mumias Sugar Company debts before luring them with many other promises.
The company spent a lion’s share of Sh2.6 billion government funding received between mid-2015 and April last year on offsetting arrears owed to farmers.
Farmers are currently owed well over Sh 12 million by the sugar milling firm according to Kenya National Federation of Sugarcane Farmers.
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“We urge the government to consider injecting more money into Mumias sugar to help it overcome current challenges,” said the federation Deputy Secretary General Simon Wesechere.
Moses Owino in charge of communications at the company promised to divulge further details over the bailout funds received by the miller later. “I have been away but promise to share the details later,” he said when reached earlier for a comment.
Washiali said most farmers are disillusioned and can only revert to cane farming if the arrears are cleared and the management start paying them promptly. “Let them use the money to pay for cane deliveries, because that will motivate the farmers,” he said.
Farmers have been demanding for a waiver of their debts and those of Mumias Sugar Company arguing that a similar gesture had been extended to tea and coffee farmers in Central and Rift Valley.
A biting raw material shortage occasioned by the move by some farmers to uproot the crop and cane poaching has complicated matters even further for Mumias sugar.