Three lobby groups join case challenging sale of parastatals

The High Court has allowed three lobby groups to join a petition challenging the sale of key parastatals by the Kenya Kwanza administration.

Justice Chacha Mwita directed Katiba Institute, The Institute for Social Accountability, and the African Centre for Open Governance to join the petition filed by journalist Gitahi Ngunyi and another filed by the Orange Democratic Movement (ODM) Party.

The lobby groups are represented by lawyer Ochiel Dudley, Ngunyi is represented by Kevin Oriri, and ODM is represented by Jackson Awele.

They have sued Attorney General Justin Muturi, Treasury Cabinet Secretary (CS) Professor Njuguna Ndung’u, the National Assembly, the Senate, and Auditor General Nancy Gathungu.

Museo Mutindi is representing Muturi and Ndung’u while Joshua Kiilu is representing the National Assembly.

The petition argues that the planned sale of the parastatals is open to abuse and pilferage by power brokers.

The lawyers argue that the law and policy paper that was developed by the late President Daniel Moi government in 1994 to guide the sale of parastatals does not ensure accountability in the sale.

They also question the role of Parliament in the process arguing that it is just a rubber stamp to what the executive wants.

They cite Section 22(5) of the Privatisation Act which states that if the National Assembly does not decide within ninety days, the privatisation programme is deemed to have been ratified.

They argue this may be the loophole to be used by the executive to dispose of the parastatals.

“Good governance principle would dictate that failure by Parliament to approve the privatisation programme – within the legislatively appointed time - amounts to rejection and not approval of the programme,” reads the petition by the lobby groups.

They say that amending the Privatisation Act last year by MPs gave CSs of the ministries that some of the parastatal falls under sweeping powers in disposing them of.

According to the petition, CSs now have the power to appoint members of and Secretaries to the Privatisation Review Board to determine disputes and appeals.

The parastatals listed for sale are Kenyatta International Convention Centre (KICC), the Kenya Seed Company, the Kenya Literature Bureau, Kenya Pipeline, New Kenya Cooperative Creameries, and the National Oil Corporation of Kenya.

“These parastatals are strategic and, except for the National Oil Corporation of Kenya, are profitable,” reads the petition.

They say that KICC is a national monument and is a strategic and iconic place in the identity of Nairobi City and Kenya.

“KICC sits in an area where critical public and national infrastructure are located, including the Supreme Court, Harambee House, Office of the President, City Hall, and Parliament. Inserting a private owner amid this public infrastructure would threaten, interfere with, pollute, and adulterate a critical and iconic space,” reads the petition.

On the other hand, Kenya Seed Company is the custodian of indigenous seeds arguing that were it to be privatised then farmers in the country would be at the mercy of private companies.

Ngunyi’s lawyer Kevin Oriri argued that state-owned entities that were privatised since the Policy Paper was formulated and the Privatisation Act passed in 2005, it is not known to whose benefit the move was taken.

“Kenyans are yet to get a proper audit report or account from the Auditor General, on the proceeds and/or propriety of the said transactions,” he said.

According to Oriri, Section 47(2) of the Privatisation Act, 2005, calls for the depositing of proceeds from the sale into a special interest-bearing account for that State corporation to protect its balance sheet erosion.

On his part,  Awele argued that some of the parastatals are strategic security institutions, meaning private persons will control Kenya, particularly the Kenya Literature Bureau, Kenya Seed Company, and the Kenya Pipeline Company.

“Further, public assets such as the Kenya Literature Bureau, Kenya Seed Company, and the Kenya Pipeline Company are strategic installations central to Kenya’s national security. Their sale accordingly elicits national security concerns that directly threaten the sovereignty of the people and Republic of Kenya,” stated Awele.

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