President William Ruto has committed to clearing approximately Ksh400 million owed to dairy farmers by the end of October 2026, announcing major structural changes to the management of New Kenya Co-operative Creameries (KCC) as the country navigates widespread milk shortages.
Speaking during his official tour of Nandi County on Sunday, October 18, 2026, President Ruto stated that the government will fully settle outstanding dues to farmers who have gone unpaid for up to three months.
The pledge arrives amid rising public concern over Kenya’s milk supply deficits, which have disrupted operations for major processors and highlighted systemic vulnerabilities across the national dairy supply chain.
“Mwisho wa mwezi huu, tunataka kulipa madeni yote, ile ya maziwa. Kuna wakulima hawajalipwa miezi mbili, miezi tatu, tunataka kulipa kila mkulima,” he declared.
(“By the end of this month, we want to clear all debts, specifically for milk. There are farmers who have not been paid for two or three months, and we want to pay every single farmer.”)
The president confirmed the exact financial requirement provided by sector officials, reaffirming the state’s readiness to clear all outstanding liabilities.
“Tuko na, nafikiri wameniambia shilingi milioni 400. Tutalipa kila mkulima deni yake, basi,” Ruto stated.
(“We have, I think they told me, 400 million shillings. We will pay every farmer their debt, and that’s it.”)
Strict Monthly Payment Deadlines Introduced
To prevent the recurrence of unpaid arrears, President Ruto introduced a strict payment timeline requiring processor management to disburse farmer earnings before the fifth day of every calendar month.
“So, na tumesema maziwa yetu tunataka ilipwe before tarehe tano, kila mtu amelipwa pesa yake, hatutaki madeni,” he said.
(“So, we have said we want our milk paid for before the fifth date; everyone paid their money; we do not want debts.”)
This directive reinforces earlier government interventions in the dairy sector, including a 2024 presidential order mandating New KCC to buy raw milk from farmers at a guaranteed minimum price of Ksh50 per liter.
Decentralizing New KCC Factory Operations
Beyond immediate debt relief, President Ruto announced a structural overhaul to decentralize New KCC operations, shifting financial control away from the corporate headquarters in Nairobi directly to local processing facilities.
“Unajua kwa muda mrefu, KCC ilikuwa inaendeshwa kutoka Nairobi, na wenye wako Nairobi hawana maziwa, sisi ndio tuko na maziwa,” he said.
(“You know for a long time, KCC was run from Nairobi, and those in Nairobi do not produce milk; we are the ones with the milk.”)
He faulted the centralized management model, pointing out that revenue generated from local milk deliveries was routinely diverted to settle unrelated central corporate obligations.
“Wakipata pesa wanaenda kulipa sijui deni gani, wanaenda kulipa sijui supply ya gani, wanaenda sijui kulipa nani,” Ruto stated.
(“When they get money, they go to pay I don’t know what debt, they go to pay I don’t know what supply, they go to pay I don’t know who.”)
Under the proposed reform, New KCC factories will adopt autonomous management structures modeled after tea and coffee processing cooperatives.
“Sisi tumesema kila factory ijisimamie. Hii ya maziwa kila factory ya KCC sasa itajisimamia,” he declared.
(“We have said every factory should manage itself. For this milk sector, every KCC factory will now manage itself.”)
Direct Local Accountability and Debt Absorption
The President emphasized that local factory management boards will face direct accountability for operational efficiency and prompt payment schedules.
“Ndio maneno ikienda kombo hatutafuti mtu Nairobi, tunatafuta huyu chairman wetu hapa,” he said, warning that mismanaging local factory funds will carry administrative and legal consequences.
(“So if things go wrong, we won’t look for someone in Nairobi; we will hold our local chairman right here accountable.”)
To ensure local processing facilities start with a clean balance sheet, the national government plans to absorb historical corporate debts accumulated at the headquarters level.
“Ile madeni imebaki kwa KCC huko ya kule Nairobi, hiyo mimi nitapambana na hiyo kule Nairobi,” he stated. “Lakini kila factory tutahakikisha kwamba hawana madeni. Deni tutachukua kama serikali, sasa nyinyi ni kuuza maziwa yenu, mnajilipa, tunasonga mbele.”
(“As for the debts remaining at KCC headquarters in Nairobi, I will deal with that in Nairobi. But we will ensure every factory operates without debts. We as the government will absorb the debt; your job now is to sell your milk, pay yourselves, and move forward.”)
The administration now faces two key benchmarks: completing the Ksh400 million payout by October 31, 2026, and enforcing the monthly November 5 payment deadline across all regional KCC processing units.
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