Last month, The National Treasury blocked a request from the State Department of Co-operatives seeking to reallocate KSh.1.5 billion from the Coffee Cherry Advance Revolving Fund to support a number of development projects in the sub-sector.
Treasury says the decision was on account of rules under the Public Finance Management (PFM) Act which prohibits reallocation of funds earmarked for transfer to another government entity or person.Coffee Cherry Advance Revolving Fund (CCARF) was established to provide affordable, sustainable and accessible cherry advance to smallholder coffee farmers.“On 2nd September 2024, we formally communicated our decision to the State Department for Cooperatives (Ref. RES 1173/24/01 ‘A’ (14)), advising them that the KSh.1.5 billion should remain dedicated to the Coffee Cherry Advance Revolving Fund’s original purpose, which is to support coffee farmers through targeted interventions,” Chris Kiptoo, Principal Secretary the National Treasury said.
The PS was responding to claims that KSh.1.5 billion from the Coffee Cherry Advance Revolving Fund had been diverted and misused to the detriment of farmers.
Kiptoo said the KSh5 billion allocated for the Coffee Cherry Advance Revolving Fund (KSh.3 billion) and Payment of Coffee Debts (KSh.2 billion), as part of the Approved Budget for FY2024/25, remains fully intact.
New KPCU was given the mandate to manage and administer the fund to coffee farmers as per the Public Finance Management Act (Coffee Cherry Advance Revolving Fund) Regulations 2020. The fund was further enhanced by the National Government and is currently being disbursed at the following rates as of December 20, 2023.
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