Surrender your shares in Mumias Sugar Company, leaders tell government

President Uhuru Kenyatta (right) with leaders from Kakamega County when he presented a cheque of Sh1 billion to Mumias Sugar Company as a bailout in June. [PHOTO: FILE/STANDARD]

A fresh row is brewing between the national government and the counties over privatisation of sugar millers in the country.

With the Government set to privatise five sugar companies (Nzoia, Chemelil, Muhoroni, Miwani and South Nyanza), elected leaders from the county have launched a fresh push to have the State relinquish its 20 per cent shares in Mumias Sugar Company.

They argued that agriculture is a devolved function and the Government should allow county governments to take total control and manage sugar millers.

They also want farmers to be involved in the process saying the model used to privatise Mumias was wrong as it failed to factor in the farmers.

Led by Governor Wycliffe Oparanya, the leaders are pushing the Government to relinquish its shares in the company to the county government.

"We want the Government to relinquish its shares in Mumias Sugar Company so that farmers and the county government can own them. The model used to privatise Mumias was wrong and need to be reworked so that the county government and other stakeholders can be involved in the process," said Mr Oparanya.

He blamed the Government for the woes affecting the company saying it has been interfering with the operations at the miller because of its major shareholding.

sound management

"Privately-owned millers, including Butali and West Kenya, have had no financial challenges because they are independent in their financial transactions. The Government has been interfering with Mumias Sugar Company because it owns the majority shares," he said.

In another brawl with the miller, Oparanya wants all land owned by the sugar company, commonly known as nucleus estates, be surrendered to the county.

He said being a community land, it should be owned by the county government adding that the move is aimed at protecting the company from selling the land in case it relocates or closes down.

Mumias West MP Johnson Naicca dismissed the model used to privatise the miller saying it was wrong and should be reworked to involve all stakeholders.

Lurambi MP Raphael Otaalo said the county government should be allowed to take over Government shares in the miller to enhance efficiency and profitability.

Meanwhile, sugarcane farmers and leaders from Kisumu and Nandi counties have opposed the decision by the Privatisation Commission to delay the settling of farmers debts until a strategic investor is identified.

The farmers, who have been banking on millions of shillings owed to them by the companies to buy the 24 per cent share stake in the ailing Government-owned sugar companies, argued that the commission's decision was a deliberate attempt to deny them a chance to own a stake in the mills.

During the stakeholders engagement meeting held at Chemelil Sugar Company on Tuesday, commission chairman Henry Obwocha told farmers that money owed to them by companies will only be settled once the investor brings in money.

"Currently, the Government has not allocated money to settle farmers' debts, but we are banking on liquid cash, which will come from the investors," said Mr Obwocha.