The government has placed an embargo on further disbursement of the Sh150 million which was meant to offset part of the huge salary arrears owed to sugar industry workers.

Reliable sources at the industry, confirmed to the Business Hub, that the disbursement of the funds had been stopped by Agriculture Principal Secretary Kipronoh Ronoh (pictured).

Sony Sugar Company Management led by Chairman Jared Kopiyo and MD Martine Dima, confirmed the recall of the cash by the PS. Ronoh recalled the funds and stopped sharing of the money as was initially proposed by Agriculture Food Authority (AFA) officials after some of the workers registered protests.

The Sh150 million was part of the Sh654 million the State issued last week to clear all cane farmer’s outstanding arrears. The farmers’ arrears took Sh354 million.

Workers arrears

Then Sh300 million remained, of which Sh150 million was disbursed to Nzoia Sugar Factory to offset its workers arrears, while the balance was to be shared by the rest.

According to the circular sent to AFA by the PS giving clear breakdown, Sh150 million was to be shared by employees of Sony Sugar, Chemelil and Muhoroni sugar employees.

He also disclosed that Kenya Agricultural and Livestock Research Organisation (Kalro) would also share part of the Sh150 million with Sony, Muhoroni and Chemelil, for multiplication of new sugarcane varieties. Each of the five sugar firms was to get about Sh30 million.

Though the workers are owed more than Sh5 billion, Ronoh earlier said that the disbursement was the first tranche and that payment process had just started. “So, the payment made will only cover one month of the arrears of the total monies owed to them by the sugar firms,’’ explained the PS in a letter to the MD AFA last week.

He said: “We received the exchequer for the appropriated budget of Sh654 million in the financial year 2023/2024 supplementary budget II support for sugar Reforms.’’

But the Unionisable workers drawn from the State-owned sugar mills weren’t happy with the share proportion of the amount to the factories.

Led by Kenya National Federation of Sugarcane growers Muhoroni branch secretary Noah Opiyo, the workers claimed that their arrears was too small for 8,000 workers.

He claimed that part of the Sh5 billion owed to the industry workers who have gone for over three years and several months was too little to make an impact.