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Economy

Sh10m Treasury cash puts Galana on back-burner

Ukur Yatani
Treasury Secretary Ukur Yatani. FILE PHOTO | NMG 

The Treasury has put the controversial Galana-Kulalu irrigation scheme on the back-burner, allocating a paltry Sh10 million in 2020/21 after denying it money in the current financial year.

While the National Irrigation Authority (NIA) had anticipated Sh9 billion in the year starting July 1 for the “model farms”, the Treasury plans to invest Sh10 million per year on the flood security project, up to 2022.

That means the flagship irrigation project will have received Sh30 million by the time President Kenyatta’s term ends.

“This amount is not enough to carry out any infrastructure project. The Sh10 million allocation in the budget is for normal operations and maintenance for the section of the farm that the NIA took over from an Israeli contractor,” Charles Muasya, Galana-Kulalu Food Security project manager told the Business Daily in a telephone interview.

Had the NIA got its way, Sh4.2 billion would finance electricity connection as the rest would be invested in reclaiming additional 10,000 acres and buying irrigation equipment.

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Mr Muasya said the model farm is sustaining itself and the NIA preparing 1,500 acres of land to be put under crop.

“We are already putting 1,500 acres under crop in this cycle. We planted 2,500 in the last cycle and are progressively going to put another 3,500 acres under crop as we plough back capital into the project,” he said.

For infrastructure development, Mr Muasya said there was a budget that was secured through a loan and discussions were ongoing to see if the NIA could access Sh2.4 billion that has not been utilised from the proceeds of the loan.

“Negotiations are ongoing to see if the money will be used to finance infrastructure development at Galana food security project. There is Sh2.4 billion that has not been utilised from the initial loan amount,” he said. The NIA took over the works at the 10,000-acre farm last year after falling out with the contractor Green Arava, overpayment issues.

The dispute between the irrigation agency and Green Arava arose from the Sh1 billion that the contractor is claiming to be owed by NIA, which on its part says that it’s excess of the actual figure of Sh200 million.

In January, then Water Cabinet secretary Simon Chelugui said completion of a million-acre project at the Galana-Kulalu irrigation scheme had stalled for lack of Sh600 million.

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