Kenyan MPs Demand Uwezo Fund Accountability Amid Audit Failures and Potential Merger
Members of the Kenyan National Assembly have issued a stern 14-day ultimatum to the management of the Uwezo Fund, a government initiative designed to provide accessible credit to youth, women, and persons with disabilities, to address significant audit failures. The directive comes as legislators scrutinize the fund’s operations following a damning report by Auditor-General Nancy Gathungu, which highlighted financial irregularities and mismanagement. The parliamentarians are also contemplating merging the Uwezo Fund with other government financing programs to streamline operations and curb inefficiencies.
The Uwezo Fund, launched in 2013, aims to empower marginalized groups by offering low-interest loans to support small businesses and community projects. However, the recent audit report has raised red flags about the fund’s financial accountability, pointing to discrepancies such as unaccounted funds, irregular disbursements, and inadequate documentation. These issues have sparked outrage among MPs, who argue that such lapses undermine the fund’s mission and erode public trust in government programs.
During a heated session of the National Assembly’s Committee on Trade, Industry, and Cooperatives, lawmakers expressed frustration over the recurring financial mismanagement. The committee, chaired by Bernard Shinali, demanded that Uwezo Fund officials provide a comprehensive explanation for the audit failures within the stipulated 14-day period. The MPs emphasized that failure to comply could lead to severe consequences, including potential sanctions or leadership changes within the fund’s management.
The audit concerns are not isolated to the Uwezo Fund. Similar issues have plagued other government financing initiatives, such as the Hustler Fund and the Women Enterprise Fund, prompting legislators to consider consolidating these programs into a single entity, tentatively named the Biashara Fund. Proponents of the merger argue that a unified fund would reduce administrative redundancies, improve oversight, and minimize opportunities for financial mismanagement. However, critics caution that merging the funds without addressing underlying governance issues could exacerbate existing problems.
The committee’s discussions also touched on the broader implications of the audit findings. Lawmakers highlighted the need for stronger internal controls and qualified personnel to manage public funds effectively. The Auditor-General’s report noted that weak financial management systems and a lack of adherence to procurement regulations have contributed to the irregularities. For instance, some constituencies reported missing project documents or backdated contracts, raising suspicions of fraudulent activities.
MPs have called for a thorough investigation into the fund’s operations, with some suggesting that the Ethics and Anti-Corruption Commission (EACC) should be involved to probe potential corruption. The legislators stressed that the Uwezo Fund’s beneficiaries, primarily vulnerable groups, deserve transparency and accountability to ensure that the loans reach their intended recipients and achieve the desired economic impact.
The proposal to merge the Uwezo Fund with other initiatives has sparked mixed reactions. Supporters, including several MPs, argue that a consolidated fund would simplify access to financing for small businesses and enhance efficiency. They point to the Hustler Fund, which has disbursed over Sh70 billion to 25 million Kenyans since its inception in 2022, as an example of a high-impact program that could benefit from integration. However, others worry that a merger could disrupt existing beneficiaries and create bureaucratic hurdles, particularly if the new entity fails to address the current funds’ systemic issues.
As the 14-day deadline looms, all eyes are on the Uwezo Fund’s management to deliver a satisfactory response to the audit concerns. The outcome of this process could shape the future of the fund and influence the government’s broader strategy for financial inclusion. Lawmakers have vowed to continue their oversight role, ensuring that public funds are used effectively to uplift the lives of Kenyans.
The National Assembly is expected to reconvene after the deadline to review the Uwezo Fund’s submission and decide on the next steps, including whether to proceed with the proposed merger. For now, the pressure is on the fund’s leadership to restore confidence and demonstrate their commitment to transparency and accountability.