Jubilee Party out of cash crunch, financial statements show

Jubilee Party headquarters in Nairobi. The party was declared technically insolvent in financial year ending June 30, 2018. [File, Standard]

Foreign donors have rescued the Jubilee Party from a financial crunch with the ruling outfit now having Sh327 million to spare, two years after it was declared broke.

Financial statements for the year ending June 2020, show that the party received “transfers from other governments – gifts and services in kind” amounting to Sh758 million up from Sh240.3 million compared to 2019.

According to the statements, net surplus (profit) jumped 93 per cent to Sh327.7 million from a deficit of Sh22 million posted the previous financial year. An added boost as the party readies its war chest for the 2022 elections.

This is as the party’s total revenue rose 56.6 per cent to Sh862.3 million from Sh373.6 million in a similar period last year.

Jubilee now finds itself highly liquid with total assets rising to Sh429 million up from Sh103 million outweighing the liabilities which stood at Sh173.6million for the period under review.

However, public contributions and donations fell 28 per cent to Sh103.8 million from Sh133.2 million the previous year.

The party’s expenses also rose by some Sh138 million to Sh534,597,243 – the bulk of it under general expenses.

In July 2020, the auditor general declared the party as "technically insolvent" in a report covering the financial year ending June 30, 2018.

The report exposed massive mismanagement of Jubilee finances that left it bankrupt, with its liabilities far exceeding its assets. 

"The statement of financial position as at June 30, 2018, reflects current liabilities balance of Sh133,558,229 which exceeds current assets of Sh67,278,244 by Sh66,279,985 implying that the party was operating with negative working capital, thus technically bankrupt," the report read.

It went on: "In the circumstances, the continued existence of the party is dependent on continued financial support from creditors, bankers and well-wishers."

Exchequer funding

The huge transfers from other governments add to the windfall from the Political Parties Fund.

Jubilee was the biggest beneficiary of the Fund in the financial year 2018/2019.

It shared Sh871.2 million with ODM, an enhancement from Sh371 million that was given a year earlier.  

About 697 million was shared proportionately according to the total number of votes garnered by each political party in the 2017 General Election.

The Political Parties Act sets aside 0.3 per cent of the national government revenue to finance activities of political parties in advancing democracy.

Jubilee and ODM were the only parties entitled to share the millions after meeting the stringent requirements set out in the Act.