A Parliamentary committee has warned of massive job losses as the State plans to merge Kenya Ports Authority (KPA), Kenya Pipelines Cooperation(KPC) and Kenya Railways Cooperation(KRC).
Members of the National Assembly Finance Committee have also raised concerns that the plan could be a scheme to use profit-making Kenya Ports Authority (KPA) to service loans the government borrowed to construct the Standard Gauge Railway (SGR).
President Uhuru Kenyatta has issued an Executive Order that will see KPA, Kenya Pipeline Corporation (KPC) and Kenya Railways Corporation (KRC) collapsed.
If this sees the light, hundreds if not thousands will lose their jobs as the organisations will have some of their departments, including human resources, ICT and legal merged.
SGR is proving to be a White Elephant as the audit reports indicate that the China runned Project has not yet started making profits and the pressure to repay the Chinese loans continues to mount.
Luanda MP Christopher Omulele and his Tetu counterpart James Gichuhi asked Treasury CS Ukur Yatani to allay stakeholders’ fears over the merger process.
“This House rejected a proposal by the ministry on railway levy meant to help service the SGR loan. I think the arrangement is another attempt to have KPA to help service the loan,” said Omulele.
According to Gachuhi, who questioned the legality of the merger, the Treasury rushed to draft the agreement for the cooperation before looking at various Acts of Parliament.
“Don’t you think you should have enacted a legal framework before getting into the agreement? I think the way this has been done violates various Acts,” said Gachuhi.
“Another issue that needs clarification is the SGR loan. We know KRC has a loan; is it that you want KPA to pay the loans owed by KCR to the Chinese government?”
On Wednesday, CS Yatani and the Director General Public Investment and Portfolio Management Stanley Kamau, who appeared before the committee, dismissed the claims of job losses and SGR loans.
According to DPIPM, the arrangement was not a merger, but a shared services arrangement in some areas to improve service delivery.
“The loan we have is a sovereign one that is budgeted for by Treasury. It has nothing to do with profits made by the institutions. There has been misconception that we want to merge the three institutions. They will remain, but with some shared services,” said Kamau.
CS Ukur Yatani said the fears of job losses were misadvised while stating that the deal will, he didn’t elaborate how, bring more opportunities.
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