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Dairy farmers petition against New KCC privatisation

27 October 2014, 16:04 Samuel Kisika

Nairobi – Dairy farmers across the country have written a petition to the National Assembly’s Agriculture, Livestock and Co-operatives committee challenging the Government’s plan to privatise the New Kenya Co-operative Creameries (New KCC).

Farmers have argued that if the planned privatisation goes on without safeguarding the their rights, they risk permanent loss of their hard earned stakes worth billions of shillings in the Co-operative by ceding 59% shareholding to private investors.

“The Government is at advanced stage of privatising the New KCC through the Initial Public Offer (IPO) of shares at the Nairobi Securities Exchange in a formula that allocates an insignificant 31% of shareholding to farmers who are the majority stakeholders, and 10% to the Government,” reads the petition.

The farmers’ representatives from dairy farming regions such as Eldoret, Nyeri, Embu, EldamaRavine, and Nairobi among others have challenged the government in the petition to protect farmers’ right to property as provided under Article 40 (3) of the Constitution.

They claim that the change in ownership of original KCC that was renamed KCC 2000 and later the New KCC was done under unclear circumstances at a throwaway price to private entrepreneurs without conclusively determining, addressing and protecting the rights and shareholding of farmers in the co-operative.

“The inalienable right of farmers to retain their majority stake can only be protected through a proposed privatisation structure that would give farmers 855 shareholding, the Government 105 and company staff 55 shares in the co-operative,” states the petition.

The petitioners have called on the Agriculture committee to intervene to ask the Auditor General to conduct a special audit on KCC to ascertain the circumstances that led to its collapse as well as the current ownership structure of the New KCC and the report submitted to the National Assembly for action as per the Constitution’s Article 229 (5) provisions.

The farmers’ representatives also urge the Privatisation Commission to ensure sustainable transfer of ownership of the New KCC to Kenya Dairy Farmers in accordance with the shareholding structure proposed by farmers rather than through the Nairobi Securities Exchange.

They further call on the Cabinet Secretary for Co-operatives, Adan Muhamed, to limit the eligible investors to Dairy Farmers’ Groups and individual dairy farmers supplying milk to New KCC as per Section 29 of the Privatisation Act, and funds generated from privatisation be channeled towards revamping of the Kenya Dairy industry.

The National Assembly’s committee on Agriculture and Co-operatives chaired by Mandera North MP, Adan Nooru, is to convene a sitting to look into the petition as directed by the National Assembly Deputy Speaker, Joyce Laboso.

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