State House spokesperson Hussein Mohamed has assured Kenyans that no jobs will be lost following the Cabinet’s decision to merge 42 state corporations with related or overlapping mandates into 20 agencies.
Nine other government agencies will also be dissolved as part of the reforms announced during a Cabinet meeting chaired by President William Ruto at the Kakamega State Lodge on Tuesday.
The restructuring aims to reduce wastage of public resources, improve efficiency, and streamline government operations. However, the announcement has sparked speculation about possible job losses among employees of the affected corporations.
In a statement on Wednesday, Mohamed clarified that all affected employees would be absorbed into the Public Service.
“No State Corporation function will be lost, and no jobs will be lost as all affected employees will be absorbed into the Public Service. This is in line with the commitment to streamline government operations, reduce waste, and curb excesses,” Mohamed wrote in a post on X.
He added, “The reforms will address operational and financial inefficiencies, enhance service delivery, and reduce reliance on the Exchequer.”
The Cabinet highlighted findings from a National Treasury assessment, which revealed that many state corporations have struggled to meet their statutory obligations. This has led to an accumulation of pending bills totaling Ksh 94.4 billion as of March 31, 2024.
Among the 42 corporations proposed for mergers are the University Fund, which will be merged with the Higher Education Loans Board, and the Kenya Rural Roads Authority, which will be consolidated with the Kenya Urban Roads Authority.
Agencies Set for Dissolution
Nine agencies are set to be dissolved, with their functions transferred to their respective parent ministries. These include:
- Kenya Film Classification Board
- LAPSSET Corridor Development Authority
- Kenya Fish Marketing Authority
- Centre for Mathematics, Science and Technology Education in Africa
Divestments and Restructuring
Sixteen corporations, such as the Numerical Machining Complex and Kenya Fishing Industries Corporation, will either be divested or dissolved, as their functions were deemed non-essential or better suited for private sector management.
Meanwhile, six state corporations, including Kenya Utalii College and the Postal Corporation of Kenya, will undergo restructuring to align with their mandates and enhance performance.
Professional organizations, such as the Nursing Council of Kenya and the Engineers Board of Kenya, will be declassified and will no longer receive government budgetary allocations.
The government has emphasized that these reforms are critical to addressing operational inefficiencies, reducing wastage, and enhancing the delivery of public services.
