NAIROBI, Kenya, Jan 24 – The National Treasury has invited members of the public to submit their views on the draft Privatisation Bill, 2023 which seeks to provide a framework for the privatization of government-owned firms.
Treasury Cabinet Secretary Njuguna Ndung’u has also invited interested members of the public to attend public consultations in various regions of the country to discuss the draft bill.
“The comments and/or input or memoranda may be forwarded via post or hand delivered to the Principal Secretary National Treasury and a soft copy emailed to [email protected] by February 7,” said Ndung’u.
If the regulations are approved, the Bill will see the establishment of a Privatisation Authority which will advise the government on all aspects of privatisation of public entities.
The Authority shall also facilitate the implementation of government policies on privatization and implement the privatisation programme.
As part of the draft regulations in the Bill, the Authority shall be managed by a Board which shall consist of a chairperson appointed by the President, the Principal Secretary to the National Treasury or a designated representative and the Principal Secretary in the Ministry for the time being responsible for matters relating to investment promotion or a designated representative.
It shall also consist the Attorney General or a designated representative;four other persons, not being public officers, appointed by the Cabinet Secretary possessing relevant skills and competencies; and the Managing Director of the Authority.
“The objectives of a privatisation undertaken under this Act shall be to encourage more participation of the private sector in the economy by shifting the production and delivery of products and services from the public sector to the private sector, improve the infrastructure and the delivery of public services through the involvement of private capital and expertise and to reduce the demand for government resources” reads the Draft Privatization Bill.
Other objectives are to generate additional revenue for the government through compensation for privatization, improve the regulation of the economy by reducing conflicts between the public sector’s regulatory functions and commercial functions, broaden the base of ownership in the Kenyan economy by encouraging private ownership and to develop the capital markets in Kenya.
The methods of privatisation of public entities shall include initial public offering of shares, sale of shares by public tendering , sale resulting from the exercise of pre-emptive rights and any other method that the Authority shall, with the approval of the Cabinet Secretary, determine.
Further, where an entity has been identified for privatisation under the Act, the Privatisation Authority shall prepare a privatisation proposal on the entity.
Among the issues to be included in the proposal are the purpose for the existence of the entity to be privatised and the extent to which that purpose or operation has been met, any rights or other entitlements and resources that have been provided to meet the purpose for the establishment or existence of the entity to be privatized, and any recommendations for continuing to meet the purpose for establishment or existence of the entity to be privatized.
The proposal will also include the financial position of the entity to be privatised; the recommended method of privatization and the estimated costs of implementing the proposed privatization, among others.
The Privatisation Bill comes after a pronouncement by President William Ruto in October last year where he said his administration targets to privatize between six to ten government-owned firms in the next twelve months.
Ruto said the move is aimed at increasing the number of listed State Owned Enterprises which will in turn attract more investors into the Nairobi Securities Exchange(NSE) that has seen little or no major investments over the last six years.
