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{
    "id": 696767,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/696767/?format=api",
    "text_counter": 195,
    "type": "speech",
    "speaker_name": "Hon. Ichung’wah",
    "speaker_title": "",
    "speaker": {
        "id": 1835,
        "legal_name": "Anthony Kimani Ichung'Wah",
        "slug": "anthony-kimani-ichungwah"
    },
    "content": "An example is the Horticultural Development Authority (HCDA), which is now a directorate under the new AFFA Act. In the Financial Year 2004/2005, they had a deficit of Kshs129 million, which brings the total cumulative deficit to a negative of close to Kshs1 billion - about Kshs763 million as at the end of June 2005. That is not the only corporation that is suffering from that sort of position. Those who come from pastoralist areas will bear me witness. A State corporation like the Kenya Meat Commission (KMC) is in a very precarious financial situation and continues to rely on old machinery to produce beef products. It has a very huge workforce of close to 1,165 people against a recommended staff establishment of about 300 people. Therefore, when we observe that those dire financial constraints are largely as a result of mismanagement and imprudent commercial decisions and practices, one wonders why a State corporation that would ideally operate with a lean staff of 300 people has to employ to the tune of about 1,200 people. That is four times the required number. Therefore, we have made certain recommendations to try and rectify that situation of very weak financial positions of many of those State corporations. One of the things that the Committee has recommended is that the State corporations that continue to perform non-strategic national functions and continue to rely on the Exchequer for financial support should be disbanded and their functions transferred to the relevant national Government departments or county governments, in line with the Fourth Schedule of the Constitution. We say this cognisant of the fact that there are a number of State corporations that are carrying out mandates that are of a devolved function by nature. Others are carrying mandates that could be better handled at the national Government level directly from the ministries without necessitating allocations from the Exchequer to particular State corporations. The second thing we have recommended is that the Inter-governmental Relations Committee that took over from where the Transition Authority left, liaises with the National Treasury and the Inspector of State Corporations to ensure that State corporations that are performing devolved functions, as I mentioned, are restructured and devolved in line with the Forth Schedule of the Constitution and allow the county governments to carry out those functions at the county level. The National Treasury should fast-track the restructuring and privatisation of poorly performing commercial State corporations such as KMC, which I have given as an example, so as to address its future commercial viability and the required financial and management resources. The other observation and area of concern that the Committee noted - as we interacted with all those 64 State corporations - was over-reliance on the Exchequer for continued financial support. We did realise that many of our State corporations, especially those in the education The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
}