Cabinet Secretary in the Ministry of Co-operatives, Wycliffe Oparanya has dismissed a new report by the Kenya Human Rights Commission, (KHRC) that had recommended scrapping of Hustler Fund.
The report released on 4th August described the fund as a politically expedient but economically disastrous initiative that has failed to deliver on its promises of financial empowerment for low-income Kenyans.
The report, “Failing the Hustlers,” concluded that the Hustler Fund is structurally unsound, economically unsustainable, and politically manipulated, and recommends that the government scrap it entirely.
“This is not financial empowerment. It is a loss-making scheme disguised as progress,” the KHRC said in the report.
However Oparanya issued a rejoinder after the report was released terming the report by KHRC as “skewed, elitist, and politically motivated.”
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The CS accused KHRC of not reaching out to the Ministry and the Fund’s management, for a response, he noted that the report’s assessment period corresponded to the financial year 2022/2023, during which the Fund was established and was only seven months old by the end of the said financial year.
KHRC had stated that the Office of the Auditor General could not conduct a full audit due to missing documentation and unsupported transactions.
The ministry however stated that most issues raised in the 2023 Auditor General’s report were not yet conclusive.
The report further stated that the fund was launched without an oversight board, violating the law. Only after litigation did the government move to appoint one. Transparency around loan allocation criteria, regional disbursement data, and performance tracking remains missing.
KHRC contends that the Hustler Fund has become more of a political tool than a financial solution as it was rolled out after elections to fulfill campaign promises rather than to address fundamental economic needs.
“There is a growing perception that the Fund is a political reward for voting, and therefore repayment is optional, this perception threatens the Fund’s credibility and undermines public accountability.” the report warns.
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The report had further revealed that the Hustler Fund was launched in November 2022 with an initial capital of Ksh50 billion and it were to provide financial relief for Kenyans at the bottom of the economic pyramid under the Bottom-up Economic Transformation Agenda (BETA).
The Ministry’s response contrasted this, where it asserted that the report had falsely claimed the Fund was capitalised with Ksh50 billion. It stated that the amount so far injected into the Fund is Ksh14 billion, which has been reinvested in a portfolio of over Ksh72 billion as of today.
The KHRC also estimated that 71.5 per cent of all loans under the Hustler Fund were functionally unrecoverable. With 71.5 per cent allegedly unrecoverable rate, taxpayers have allegedly absorbed losses of more than Ksh50 million daily.
A statement governmentt dismissed noting that the Fund had established the credit histories of over 26 million beneficiaries, adding that over nine million people borrow regularly from the Fund.
By Obegi Malack
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