The Treasury has revealed the State forcibly took over Kenyatta University referral hospital from the higher learning institution after it defaulted on a Sh10 billion Chinese loan.
Treasury secretary UKur Yatani says the conversion of the Kenyatta University Teaching, Research and Referral Hospital (KUTRRH) into an independent State agency is aimed at recovering $99 million (Sh11.18 billion under prevailing rates) which the State borrowed from Export-Import Bank (Exim) of China on behalf of the university a decade ago.
This implies the government will use revenue from the referral hospital to offset part of the loan owed to China’s Exim Bank and ease the burden on taxpayers.
The revelation from the Treasury came weeks after Parliament directed the referral hospital be returned to Kenyatta University.
Documents tabled in Parliament exposed silent wars pitting the hospital board against the Kenyatta University (KU) management for control of the multibillion-shilling facility.
“The Kenyatta University Hospital constructed through an on-lent loan has since been taken over and is being managed by the national government to recover the loan amount after non-settlement of their arrears,” Mr Yatani says in the latest public debt disclosures.