Meru in Crisis as President Ruto’s KSh700M Promise Leads to Treasury Cuts

Meru County is facing a serious financial crisis after a government promise to clear a major debt did not materialise, leaving operations strained and workers unpaid.

The trouble began after a public commitment made in May 2025 during a visit to Meru National Park, where President William Ruto said the national government would settle a KSh700 million debt owed by the county to a French investor.

The statement raised hope among county leaders who believed relief had finally come.

However, Treasury Cabinet Secretary John Mbadi later said the money had not been budgeted, and the debt remains unpaid.

As a result, the National Treasury started deducting 50% of Meru County’s monthly allocation to recover the amount.

Isaac Mutuma told the Senate Finance Committee that the situation has pushed the county into a severe cash shortage. 

“The freeze has plunged the county into a cash crisis,” he said. “We are unable to pay staff on time, and we have a backlog of KSh1.3 billion owed to local suppliers.”

He added that employee benefits have not been remitted for months, while shortages of medical supplies are worsening because payments to the Kenya Medical Supplies Authority (KEMSA) have stalled.

The financial crisis traces back to a lease agreement signed in 1997 with Leopard Rock Mico Limited, a company linked to French investor Michel Dechaufour.

The contract was later terminated in 2018, leading to a legal dispute.

In 2019, an arbitrator ruled that the county should pay KSh339 million.

However, delays in payment led to accumulated interest of 14 percent, pushing the total claim to over KSh800 million.

Governor Mutuma has now asked the National Treasury to suspend the deductions, saying the county is being overwhelmed by obligations it inherited.

“We humbly request your office to suspend the proposed stoppage, as it will greatly affect the County Government of Meru’s operations and ability to offer essential services,” he said.