Employers who will fail to remit member deductions will have their assets auctioned off if Parliament adopts the Cooperative Bill 2023.
Cooperatives Cabinet Secretary Simion Chelgui said Cabinet has approved the bill that will give the commissioner for cooperatives sweeping powers to enforce remittance compliance, with the bill also proposing estates of officials engaging in Saccos fraud attached in recovery efforts.
Cooperatives are seeking Ksh 3.5 billion in member deductions that have not been remitted by a number of entities both in the public and private sectors.
Defaulters have only managed to pay Ksh 500 million from the accrued Ksh 4 billion that are owed by SACCOs.
In a bid to enforce the remittance of members’ deductions, the cabinet has approved the cooperative bill that will give the commissioner for cooperatives powers to attach assets of defaulters in cases of non-remittance.
Chelgui said the bill is also seeking to liquidate Saccos that are currently facing financial headwinds due to non-remittance.
The bill further proposes to attach the wealth of officials who embezzle and squander members’ funds.
This comes at a time when Saccos are urging the government to re-consider the 15pc tax on dividends earnings to attract more members boosting national savings.
The Saccos are also calling on tax breaks and moratoriums to cushion the societies from the current economic hardships.