The Ministry of Water is on the spot over delayed utilisation of a Sh20 billion loan that the government borrowed two years ago from foreign lenders to finance the development of water projects in the country.
The National Assembly’s Committee on Public Debt and Privatisation on Thursday put Water Principal Secretary Julius Korir to task to explain why the proceeds of the loans from the World Bank and the government of Germany had not been utilised to construct water projects.
Kenya acquired Euros 121.7 million (Sh17.56 billion) from the International Development Association (IDA) on September 1, 2022 to finance the Horn of Africa Groundwater for Resilience project.
The government also signed a Euros 18 million loan on November 28, 2022 with the German government to finance the Lake Victoria South waste Water Management project.
”This committee is concerned with the absorption rate of these loans. You are at two percent and zero percent on the first and second loan respectively, which is too low. Out of the Sh17.56 billion, you have only drawn two percent two years after signing the loan,” Abdi Shurie, who chairs the committee said.
”For the second loan of Sh2.6 billion, you have not drawn anything. This is despite the fact that the country face 0.5 percent penalty per annum in financing costs for the undrawn loan amount.”
The Sh17.56 billion IDA loan was meant to finance the rehabilitation of existing 200 boreholes and drilling of another 200 new boreholes in five counties of Garissa, Wajir, Mandera, Marsabit and Turkana.
Mr Korir told the committee chaired by Balambala MP that the Ministry has only drawn down Sh398 million to finance initial activities involving preparatory works like building capacity of implementing agencies or recruitment of key social and environmental safeguards staff, establishment of project implementation staff and offices, selection of sites and community engagement.
Loan drawdown
The PS said the Sh2.6 billion loan from the German government meant to protect Lake Victoria by supporting waste water management and last-mile connectivity in the towns of Kisii, Keruicho and Litein had not been drawn.
He attributed delays in implementation of the water projects and drawdown of the loan amounts to the lengthy and several procurement milestone requirements.
The PS said the setting up of the Project Coordination Unit at the Ministry, Project Implementation Units (PIUs) for Water Resources Authority and Water Sector Trust Fund also delayed the progress of implementation.
Mr Korir said consultation between the ministry and the benefiting county governments who are to procure and implement the water projects had taken long to conclude.
”The overall progress for the support to the Waste Water Management Project is about 15 percent being procurement of supervision consultancy services for detailed design, tender documents preparation and construction,” Mr Korir told MPs.
”The contract was awarded on August 5, 2024, contract signed, and the consultant has mobilised equipment and personnel to deliver the necessary outputs,” he said.
Mr Korir said land acquisition has been undertaken and the National Environment Management Authority (Nema) license obtained for the Kisii, Kericho and Litein projects.
He said the consultant is finalising designs so that tendering for the construction works can commence in March 2025.
He said the Lake Victoria project focuses on Kericho, Letein and Kisii towns to complement the earlier interventions already undertaken under the Water Sector Development Programme financed by the Kenyan government and the government of Germany.
On the rehabilitation and drilling of 400 boreholes in the five counties of Garissa, Wajir, Mandera, Marsabit and Turkana, Mr Korir said the project will be implemented through the water Sector Trust Fund (WSTF).
He said an inventory of the existing boreholes was carried out and sites for rehabilitation prioritised.
Mr Korir said 30 sites per county have been selected for the first lot covering Turkana and Marsabit counties.
