State agency freezes Egerton bank accounts over Sh246 million unpaid dues

The bank accounts were frozen a week ago owing to a debt amounting to Sh246 million. [Courtesy]

Egerton University is facing a financial crisis after the Commissioner for Cooperative Development froze its bank accounts over workers’ deduction arrears.

Documents seen by Sunday Standard show that the bank accounts were frozen a week ago owing to a debt amounting to Sh246 million.

The Commissioner for Cooperative Development Mary Mungai said the university had not been remitting contributions deducted from employees from January this year. Money deducted from workers to repay loans has also not been remitted to Egerton Savings and Cooperative Society.

Speaking to the Sunday Standard on Friday, Vice Chancellor Rose Monya admitted that the Commissioner for Cooperative development had indeed frozen Egerton bank accounts, saying the issue was being sorted out.

She downplayed claims that there was a crisis at the university, saying “everything was on going on well.”

“I’m not aware of any crisis. Yes, we had a problem with the cooperative society but that has been sorted out,” Prof Monya said.

But Fredrick Juma, the University Academic Staff Union (UASU) treasurer, said no agreement has been reached over the matter and the accounts are still frozen after the Prof Monya declined to give her comment on the way-forward. “There was a meeting early this week but nothing much came out of it after her offer was rejected by the cooperative,” Dr Juma said.

According to sources, the Vice Chancellor had offered to give the cooperative Sh60 million as the first installment to have one of the bank accounts that has Sh203 million unfrozen.

“When she failed to commit the university in paying the balance, the cooperative declined the offer and we now have a stalemate,” an official of the cooperative who did not wish to be named said.

The freezing of Egerton University’s bank accounts came following a report on how institutions of higher learning were not submitting statutory deductions.

Vice Chancellors Committee Chairman Francis Aduol said last month that universities were not remitting the money to the relevant institutions.