Muhoroni Sugar on the spot over cheques

A fresh row is brewing between struggling state-owned miller Muhoroni Sugar factory and farmers after the miller allegedly issued farmers with fake cheques.

Farmers who claim the miller still owes them million accused Muhoroni of issuing cheques that could not reflect in their bank accounts.

They want the national government to speed up the privatization process to enable investors to start the process of solving the woes that have dented image of the struggling miller.

About two weeks ago, farmers started having a sigh of relief after the management began offsetting debts.
Kenya Sugarcane Growers Association Chairman Charles Atyang told The Standard that banks turned away all the cheques the factory issued.

The farmers have now threatened to stop supplying cane to the miller and are appealing to the government to fast track the privatization process to help the troubled miller to get out of the woods.

In one of the cheques seen by The Standard, the miller paid Sh839, 014 to a farmer’s corporative society vide a cheque. Farmers claim that the payment is among those that have failed to go through.

On Thursday however, the miller defended the payments and claimed that it had an administrative issue with some of the cheques and claimed the issue is being politicized.

Francis Ooko, a receiver-manager told The Standard that there were some issues at the finance department with the balancing of financial records which affected the payments.

“There was a problem with some of the cheques but we are sorting them out. The sugar industry has been doing badly and it is not just about Muhoroni alone,” said Ooko.

Ooko who also sits in the privatisation commission said that the process of privatization will take time and urged all stakeholders to back the current management which is working around the clock to stabilise sugar production at the factory.

Last year, the company that is under receivership grappled with a shortage of cane after several farmers withdrew supply over lack of payment.