Govt Drops New KCC From List Of Parastatals Up For Sale

The government, through Cooperatives Cabinet Secretary Simon Chelugui retracted earlier plans to sell the New Kenya Cooperative Creameries (KCC) as a parastatal.

The CS in a statement revealed that President William Ruto's administration would not sell New KCC despite being among 11 parastatals put up for sale.

"I want to state as follows. On March 22, 2019, the Cabinet resolved to remove KCC from privatisation. That position stands and can only be reversed by a similar Cabinet resolution," Chelugui indicated.

Cooperative CS Simon Chelugui speaking in Naivasha on November 30, 2023. /SIMON CHELUGUI

The CS indicated that he planned to write to the National Treasury on the issue quoting the 2019 resolution when former President Uhuru's cabinet had been cautioned against privatising KCC as it played an integral role in milk stabilisation.

In his letter to the Treasury, Chelugui indicated that he would list reasons why the cabinet of the time thought KCC did not fit into the privatization programme, citing its importance in the government's launch of interventions in the dairy sector.

“On the issue of privatization, Chair, CEO and the board of management unless another cabinet memo is brought, as far as cabinet is concerned that is the position,” He assured the leadership of the dairy processor in a meeting on Thursday evening, November 30 in Naivasha.

“I am not saying privatization is bad, but we want to complete the establishment and position KCC strategically and then offer it to the market."

Chelugui further disclosed that in the event the government were to sell the New KCC, the first offer would be to the farmers through their respective cooperative societies.

In the 2019 memo, the cabinet cited the role of KCC in the dairy sector and highlighted the processor as the buyer of the last resort. The cabinet also underscored New KCC’s position in making government intervention in addressing the dairy sector issues such as price stabilization.

“You see, we have given you Ksh500 million and we have set the price of milk at Ksh45. Others are at Ksh33.

"Those are private agencies who ask farmers to take it or leave it. As government, we cannot do that because we are conscious of the cost of production,” he said.

Other companies that were targeted for sale by the government include Kenya Literature Bureau (KLB), Kenyatta International Convention Centre (KICC), National Oil Corporation (NOC), Kenya Seed Company Limited, Mwea Rice Mills, and Western Kenya Rice Mills Limited.

The Treasury, led by CS Njuguna Ndung'u, also listed Kenya Pipeline Company, Kenya Vehicle Manufacturers Limited, Rivatex East Africa Limited, and Numerical Machining Complex as companies up for sale.