MPs have raised concerns over reports of a plan to transition the New Kenya Cooperative Creameries (New KCC) to private management cautioning the move could be counterproductive.
Sotik MP Francis Sigei has sought a statement from the departmental Committee on Agriculture and Livestock seeking clarity on the move he claims could affect dairy farmers, employees and other stakeholders.
Sigei argues the New KCC Sotik plant has for years played a critical role in the dairy value chain by providing a ready market for milk produced by farmers and supporting hundreds of households dependent on the dairy economy.
“Over the years, New KCC, particularly the Sotik plant, has continued to play a significant role in the dairy sector value chain by providing a market for milk produced by farmers,” Sigei said.
The lawmaker said reports of the planned transition had heightened concerns among farmers, employees, suppliers and service providers, with some stakeholders allegedly yet to receive payments.
He raised concern that some dues, including statutory deductions, had reportedly not been remitted since June.
Sigei now wants the Agriculture and Livestock Committee to establish the current ownership and operational status of the Sotik plant and provide details of any plans, timelines and procedures for transitioning New KCC from State ownership to private management.
He also wants the committee to explain the policy rationale behind the proposed change, including its objectives and the expected benefits to dairy farmers.
The MP's request comes amid growing questions over the future of state-owned enterprises and the safeguards required when public assets are transferred to private management.
Sigei further demanded details of any public participation and consultations undertaken before the proposed transition.
He wants the committee to establish whether dairy farmers, co-operative societies, employees, suppliers, consumers and other stakeholders have been consulted and how their views have influenced the process.
The MP also wants a comprehensive audit of all outstanding debts and liabilities involving the Sotik plant.
These include money owed to dairy farmers, co-operatives, suppliers, employees and other creditors, as well as liabilities owed by the plant.
He said arrangements should be made to settle or offset the debts before or during the transition.
Of particular concern to Sigei is the protection of public investments at the plant.
The lawmaker wants the committee to explain measures put in place to safeguard the plant's land, buildings, machinery, equipment, infrastructure and other public resources from loss or improper disposal during the transition.
New KCC was established in 1925 as the Kenya Co-operative Creameries before being rebranded as New KCC in 2005. It has remained a fully state-owned enterprise.
The government in the past had announced plans to privatise struggling KCC as part of addressing farmers’ payments and productivity.
The MP however said any decision to change its management structure should take into account the interests of farmers who rely on the company as a market for their milk.
He further called for clarity on the regulatory and oversight framework that would govern New KCC under private management.
The framework, he said, should guarantee continued support for the dairy sector while promoting fair competition, transparency and accountability.
It should also protect the interests of farmers, consumers, employees and other players in the dairy value chain warning that lack of clarity over the process could deepen uncertainty in Sotik and undermine confidence among farmers and other stakeholders who depend on the plant.
He maintained that Parliament needed assurances that the transition, if approved, would not compromise the public interest or undermine the role New KCC has played in supporting Kenya's dairy industry.
