The journey towards the privatization of loss-making and non-strategic government entities has begun in earnest after President William Ruto officially signed the Privatisation Bill, 2023 into law.
The Head of State on Monday assented to the Bill, paving way for the offloading of parastatals and various government institutions deemed to be loss-making entities.
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The new law repeals the Privatisation Act, 2005 which was enacted before the current Constitution.
It seeks to remove the bureaucracy in the privatisation of non-strategic or loss-making government entities.
Ruto signed the Bill into law in a ceremony which took place at State House, Kisumu and was witnessed by Deputy President Rigathi Gachagua, National Assembly Speaker Moses Wetang’ula, Attorney-General Justin Muturi, National Assembly leader of Majority Kimani Ichung’wa and CSs Eliud Owalo and Rebecca Miano.
The Bill encourages more participation of the private sector in the economy by shifting the production and delivery of products and services from the public sector.
It also aims to improve the infrastructure and delivery of public services through the involvement of private capital and expertise.
Sponsored by the Ichung’wah, the Bill also provides for the establishment of the Privatisation Authority.
Mr Ichung’wah noted that the Bill assigns the responsibility of formulating the privatisation programme to the Cabinet Secretary.
“The privatisation programme shall be submitted to and approved by Cabinet. The role of the National Assembly shall be to ratify the programme,” he said.
In the new move, privatisation will be done through initial public offering of shares, sale of shares by public tender, sale resulting from the exercise of pre-emptive rights or through any other method that will be defined by the Cabinet.
The Bill provides that the proceeds from the sale of a direct national government shareholding shall be paid into the Consolidated Fund.