Hon. Members, we are short of the requisite quorum. I, therefore order that the Quorum Bell be rung for 10 minutes.

Hon. Members, we now have the requisite quorum and are ready to start business on the Order Paper.

Hon. Members, having confirmed that we have the requisite quorum, I proceed to put the Question.

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Do we have Hon. Ochieng? Hon. Ochieng, are you ready to move this Bill?

Hon. Temporary Deputy Speaker, I beg to move that the Institute of Directors of Kenya Bill 2015 be now read a Second Time.

The consultations are too high. I cannot even hear myself from where I am.

Order, Hon. Members! Not that I am interested in Hon. Ochieng hearing himself, but I think the House will do itself a lot of favour listening to him. I am sure he will have digested it in the brain before he says it. This is an extremely important Bill.

Thank you, Hon. Temporary Deputy Speaker. As you are aware, corporate governance is one of the most important things that we need to be talking about in this century. Corporate governance is not an end in itself, but it is a means to support the way public and private entities are run. I am moving this Bill at a time when just last week we had to adjourn the House to discuss the happenings at the Kenya Airways. We have seen how the National Youth Service (NYS) has been managed. We have seen how so many private and public entities like the Mumias Sugar have been managed. We have seen companies going down largely because of the way they have been managed in the corporate sense. This Bill is supposed to help establish an institutional framework for building the capacity of those who want to be directors in either public or private entities. Last year, we passed new company laws that gave companies requirements on how to operate in this country. We have allowed the market to regulate how we appoint directors, who trains them and whether they report to anybody. We have allowed the market to regulate that and take care of anything wrong that happens there. You realise that if we, as a country, do not invest in training, building capacity and continually developing skills of the persons who manage our public and private entities, we may not go very far, especially in a country where we have a lot of corruption. We have hoped that criminalising corruption and everything wrong will help us. It has not helped so much. There is need for a soft approach in the way we deal with how we run our public affairs and the affairs of companies that are publicly listed. This Bill is going to help us to create the Institute of Directors in this country. The body will help inculcate the ethos and principles of good governance, which include having effective leadership of boards and having boards that are capable and which have a mixture of skills, experience and independence to enable members to discharge their duties and responsibilities effectively. If passed, this Bill will encourage accountability, being able to communicate to the companies’ shareholders at regular intervals and fair and balanced understanding as to how companies are supposed to achieve their businesses. If we pass this Bill, we will encourage sustainability of our public listed companies and parastatals. 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.

You should be aware that in this country, directors are appointed from all walks of lives as it should be. A director of a company should have skills. As soon as one is appointed, he should have capacity to learn how to interact and operate the business of the board that he has been appointed to. This country has more than 100 parastatals, but as you know now, they have become places where we recycle politicians and appoint people who have campaigned for us who want to give favours. That is not the problem. The problem is: Once you are appointed to a board, do you have the capacity to engage with the business of the board? Are you able to conduct the affairs of the board in the required manner? Are you able to competently engage and ensure that what the board is supposed to do is being done in a manner that furthers the interests of the country? Are you doing things to enrich yourself and your family? This Bill ensures that the membership of the Institute is going to be voluntary. We will not force you to join the Institute. Once you join, we will take you through training. You will sign to regular intervals of training. We will require that you do a couple of trainings every year before you renew your membership. Once you are a member, you will benefit from the following things that the Institute will be doing:- (i) Promotion of standards of professional competence and practice amongst members of the Institute. (ii) Promotion of research into the subject of directorship, corporate governance and related matters. (iii) Promote international recognition of the Institute to ensure that all persons who act as directors of State organs, entities and emprises in Kenya meet the standards of learning, professional competence and professional conduct that are appropriate for such posts. (iv) Protect and assist members of the public in Kenya in matters relating to or incidental to the directorship and corporate governance. This Bill will help set, maintain and enhance the standards of professional practice and ethical conduct of directors of State organs, entities and enterprises alongside public listed entities and companies. It will also help protect and promote the public interest generally by providing a fair, effective, efficient and transparent procedure for the resolution of complaints against members of the Institute. One peculiar provision of this Bill is that for the first time, we seek to introduce a system for self-regulation of directors either in public or private companies. It ensures that the board of the Institute is able to continually check its members who sign onto it to ensure that they live with and are guided by the principle of corporate governance. There is a person they can answer to and that can discipline them. There is a way in which this body can ensure that if you are not doing your work properly, they can decide that you can never be a director in any public company because you do not qualify. Under this Bill, we are going to ensure that the board registers members of the Institute like I said earlier. Once you are a member, you can be disciplined. Hon. Temporary Deputy Speaker, as a lawyer, you do your practise within the confines of the law. Members of the public can complain against you and if the committee in charge of discipline at the Law Society of Kenya (LSK) finds that what you have done is against the code of conduct, they can defrock you or bar you from practising law in this country. You must meet the requirements. The Bill proposes that anybody can be a director. A teacher, lawyer or doctor can be a director. However, if you are a member of the Institute, we will be looking at your conduct. Much as we will train you and build your capacity to competently engage with the 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.

company you are managing, we will look at your conduct in the way and manner in which you do these things. Although it is not provided expressly in this Bill, we are saying that if the Government of the day thinks that the membership of the Institute helps encourage good governance, then the Government may be encouraged, as they staff boards of parastatals, to have recourse to the members of the Institute. It is not a requirement, but it will encourage good governance in public entities. Of course, I realise that if we provide that they must be from that Institute, then it would unduly restrict the appointing authority in terms of where they can get people from. Once these people are appointed, it would be in good taste and sense that they go through proper training. What happens today is that if you are appointed to a board of any public entity, the first or second week, the Chief Executive Officer (CEO) of that board takes you for something called an induction. During that period, probably in Mombasa or somewhere else, you are taken through by the CEO and his management team on what the company does, how it operates and what it has been doing all this time. The information given to you depends on how much the management thinks you should know. Through the Institute, we will take members of public institutions and entities who think this Institute can help them through a wide range of things that will help them manage public entities, public listed companies and even your own family companies, if you so choose. This will ensure that the companies are managed in a manner that promotes stability, sustainability and integrity. This Bill sets out how one will behave after being registered as a member of the Institute. It also sets out how we can cancel your membership if you do not behave well. The board consists of a chairman and 10 members. Membership is voluntary, but once you get in, the rules are set and you must meet the code of conduct. A committee will be set up under the board to vet members before they register with the Institute. This Institute will set qualifications of the members of the Institute. It is going to broadly allow anybody in the country, be it a university or college, to train people based on an agreed curriculum on corporate and good governance and how to manage companies. Anybody can train and have common exams. We can have continuous education in this area being run as set out by the Institute. I have talked about discipline. I have also talked about how we will ensure that the provisions of this Bill are implemented by providing for penalties and enforcement mechanism under the Bill. As I finish, it will be important for the Government of Kenya to look into this. As you know, when this Government came in, there was a task force that was set up to do a couple of things. One was to see how we can reduce the number of our parastatals in this country, make them efficient and professionalise the appointment of directors to these companies. As you can imagine, with competing political interests and the need to take in a number of people in the Government, this never happened. There was a taskforce led by a gentleman called Mr. Awuondo and co-chaired by Hon. Abdikadir, a former Member of this Parliament. They gave their report which was all over the newspapers and we were waiting for a Bill on this Floor, but it never happened because like I have said, the exigencies of the day probably convinced somebody that we do not need to reduce the number of members in the boards. So, it happened that way. This Bill will still further those functions by, at least, ensuring that our public entities are run in an efficient, competent and profitable manner. So, I request Members to support this Bill 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.

so that for the first time we have in law a way of ensuring that our businesses are run competently and we do not have losses being made by public entities like KQ. With those many remarks, I beg to move and request Hon. Chris Wamalwa to second. Thank you.

Before Hon. Wamalwa seconds, let me recognise pupils from the General Service Unit (GSU) Boarding Primary School from Ruaraka Constituency, Nairobi County, who are in the Assembly to learn how work is done here. Feel welcome.

Hon. Wamalwa, please, proceed.

Thank you Hon. Temporary Deputy Speaker. This is a very important Bill that is going to ensure that there is corporate governance in our State corporations. It is going to ensure efficiency and effectiveness. Directors play a critical role in any institution. They provide oversight. State corporations like the Capital Markets Authority, the National Social Security Fund (NSSF) and the Agricultural Finance Corporation (AFC) are headed by a Chief Executive Officer (CEO) or a Managing Director. A CEO plays a critical role in strategic decision- making of any entity. As they come up with proposals, they have to go to the board of directors. The board of directors is supposed to look at the proposals that have been made by the management. The board of directors approves those proposals. They can only be implemented if they have been approved. That is why it is important that members of the board of directors have the capacity and the expertise that will help them to approve the decisions by the CEO. We heard about some CEOs who have had conflict of interest issues, for example, KQ. I sit in the Public Investments Committee (PIC), which is supposed to look at prudent management of the investments the public make in these parastatals and whether the public gets money. The CEOs make decisions and the board is just there to rubberstamp. This is because the board members are ignorant and do not have what it takes. Most of the time, the directors are appointed because of some political affiliations. This Bill is going to streamline those issues. If you have had a chance to look at the Mwongozo, which was brought up by the Jubilee Government to provide a framework of providing guidelines in terms of how to run public institutions - unfortunately, Mwongozo is just a policy - it does not have strength when it comes to matters of law. Right now, it is going to be a statute and it is going to have more teeth to bite in case there is going to be a problem. Accountability is important. A rogue president might come and decide to do away with Mwongozo . I have looked at Mwongozo and seen that it has very good regulations, but unfortunately, the level of implementation is a challenge. I want to mention an example of the Youth Enterprise Development Fund (YEDF), where we had a chairman called Bruce Odhiambo, who dictated to the CEO what she was supposed to do. Most of the corruption that we have in this country comes from the board of directors. In some cases, the CEOs are working under duress. For example, at the YEDF, some of Bruce Odhiambo’s companies were procured to offer services in this institution. If this Institute is going to be registered, the board of directors will be trained on corporate governance. Article 226 of the Constitution is very clear in terms of financial management reporting and audits. These Reports are supposed to come to this Parliament. The PIC and the PAC are the critical committees that should look into these issues. The PAC looks at Government Ministries 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.

while the PIC looks into issues of parastatals. I am a Member of the PIC and most of the time, we find that procurement rules are not being followed. When you interrogate the issues, you find that the problem comes from the board of directors. We can look at the KQ under Titus Naikuni as the CEO and the current CEO, Mr. Ngunze. The KLM being a shareholder and owned by the Lafarge Company, a French company and one of the biggest multinationals, the KQ CEOs represented Lafarge. That is why we had conflict of interest. In terms of corporate governance where we have the CEO, they must be distinct from the board of directors. In decision-making, whatever the senior management proposes has to go to the board for purposes of approval. However, in a situation where you have a CEO and at the same time the same CEO has determined the board of directors, when it comes to decision- making, the board members are just rubberstamps. One of the biggest problems in KQ has been issues to do with governance. The CEOs are so powerful that the board of directors are just there as rubberstamps. This Bill is going to put in place continuous training, so that the directors can have capacity to make decisions for the interest and the success of that entity. Hon. Temporary Deputy Speaker, I have looked at the Institute of Directors of Kenya Bill and it is a good Bill. I have a humble request to make as we move forward. I know it has nothing to do with counties, but we have seen some situations where some counties have started coming up with their own parastatals. For example, we have the Nairobi City Water and Sewerage Company in Nairobi. I was talking to the Governor, Meru County, the other day and they are also trying to come up with something. Maybe at a later stage, we will also involve those parastatals which have been created in the respective counties, so that whatever they establish, corporate governance should be in line with whatever is outlined here.

Another issue that I wanted to mention is that we have something called professional points in many professional bodies. When this Institute is in place, some people will be too old and things will have changed. They must be encouraged to go for continuous training. We have people who practised law a long time ago and law has been changing. So, unless there is continuous training, you will be outdated. This must be encouraged in any profession, for example, in the medical practice. The way malaria was managed in the 1960s is not the same today. Things have changed. The way malaria is being managed today is different from how it was managed in the 1980s. It is very important for professionals to go through continuous training to update their skills on the latest technological advancement. This Bill is going to help. When you look around, we have good boards of directors. These are gurus. Every corporate organisation wants so and so to be on their board just because their trend has been demonstrated as being good corporate managers. An example is somebody like Manu Chandaria. Having been a consultant to some of the series of Manu Chandaria’s group of companies, he is an old man who believes in professionalism. Any good organisation is looking for Manu Chandaria to be on their board. Another one is Michael Joseph. When he was the CEO of Safaricom, Safaricom made abnormal profits because of the strategies that they put in place. You realise that any company that is going down wants to get a Michael Joseph because he has demonstrated his expertise in aspects of corporate governance. When it comes to the organogram of any organisation, at the top strategic level, we are looking at leadership. We are not looking at technical expertise. Technical expertise will come in at the operational level. That is why we have been saying that you can be a CEO of Kenyatta National Hospital, not necessarily because you are a medical doctor. In top decision-making positions, you provide leadership. You provide issues of teamwork and transformational leadership that is likely to impact positively on all kinds of forces that work with you. 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.

This is a critical Bill. I want to encourage Members to look at this Bill critically. I can assure you that if we pass this Bill, some of the State corporations that are going down will start coming up. Parastatals are supposed to have some strategies so that they can be self-sustainable. But we are seeing many corporate organisations going back to the Exchequer for funding. I agree with the Abdikadir Task Force which proposed to narrow down and consolidate parastatals, so that they can be able to sustain themselves. Some parastatals are a liability but, because of political interest, they exist with no value. They cannot even afford to pay allowances to the members of the board when they meet. It is high time His Excellency the President led as an example and implemented the Abdikadir Report. I know it is going to be very difficult because we are going for elections and he wants to please different regions by giving them something small here and there, but after 2017, whoever becomes the President should implement whatever we are going to pass. I am humbly requesting Members to support this Bill. We have talked much and I do not have to say much. I want to stop there and request Members to support the Bill. I second.

Very well. Before I propose the Question, let me recognise the presence, in the Public Gallery, of pupils from the Presbyterian Church of East Africa (PCEA) Umoja Primary School, Embakasi West of Nairobi County and Moi Airbase School from Kamukunji Constituency of Nairobi County.

I will give the first opportunity to the Member for Lagdera Constituency.

Thank you, Temporary Deputy Speaker, for giving me this opportunity. This is one of the best Bills that have ever come to this House. The Institute of Directors of Kenya Bill is a stock genius in the Kenyan political parlance and corporate governance in this country. Why do I say this? For far too long, this country has had many issues of governance with corporations. Many parastatals have gone on adventure with the taxpayers’ money. It is very unfortunate that if you look at KQ, for instance, we had Eng. Naikuni, who brought the company up. It became very colourful and was branded the Pride of Africa. We were controlling the African skies, but when he knew that he was on his exit, he played with issues of procurement and governance. At the end of the day, there was a deluge. The entire company went down and it is making huge losses. We are losing business. Hon. Temporary Deputy Speaker, if you do not have a national carrier that works very well in a country like Kenya, tourism will nosedive. Kenya is known as a country with highly educated and skilful people, but when it comes to corporate governance, we are far below. For countries like Korea, China and Malaysia, it is the parastatals that bring huge sums of money, profits and dividends to the people every year. The Chinese building the Standard Gauge Railway (SGR) and the construction companies that are involved are mostly owned by the Government. We even have prisoners working in them. It is because of corporate governance that they are very successful. We have too many parastatals. Some are doing very well and some are not doing well. I will give you the case of Uchumi. Why did Uchumi go down? When Mr. Ciano was taken there, the whole media was awash with how good he was going to do. What happened within a short time? The company went down and it has to go to the Exchequer to save itself. 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.

The Mwongo zo, which was done by the team led by Hon. Abdikadir, was a wonderful document. They wanted to streamline parastatals. We have so many parastatals and some are idle. They do not even have money to run any developmental agenda. Some are just depending on the Exchequer release for their salaries. Those parastatals must be brought together. They must be collapsed because some of them are pensioners. The officers are just earning salaries and do not do any work. This Bill has come at the right time. It is very good because it will bring discipline, order and sanity to the whole body of corporations in this country. When you have companies like Mumias Sugar Company (MSC), which we were depending on yet today they depend on Exchequer release, you will understand the questions: Where did we go wrong? Where did the rain start beating us? Why are we where we are today? This Bill proposes continuous training, the much needed skills, direction and much more. When you misbehave as a director and a member of this body, like other professional bodies, you will certainly be blacklisted because you are not delivering on your mandate. There are people in this city who hop from one parastatal to another and they are being appointed every other time.

We ask ourselves why such people have been appointed. We have people who have been appointed chairmen of parastatals and have run them down. When they move to other parastatals, the same thing happens. They become directors in other parastatals, they attend board meetings from one parastatal to another throughout, yet they do not add any value. It is very unfortunate. When somebody is appointed and is not adding value to the Kenyan people, the best thing is for him or her to exit. Sometimes I believe in what Chinese do. If you are corrupt, they will not spare you. They will kill you. They have a firing squad to finish you for good. Sometimes this is very important especially when you know that a parastatal is a lifeline for the children of this country. Somebody wants to mess the parastatal just because he or she wants to make kitu kidogo orkubwa out of it while the rest of the Kenyans are suffering. Time has come for us to have a paradigm shift in our thinking. There must be a radical surgery in the way we run public institutions. Some public institutions have been turned to private ones. It is as if an organisation is owned by an individual. It is unfortunate to see the Kenya Co-operative Creameries (KCC) going down. Banks owned by the Government make losses and once they are sold to a private entity, within a short time, there is a turnaround and they begin to make money. Where is the problem? When it is public, citizens lose, but when it is private, people do the right thing. This Bill is going to bring sanity into corporate governance. It is going to bring checks and balances. It will also change the thinking of Kenyans. Time has come for Kenyans to think deeply. If you look at the number of parastatals that we have in this country, every day their numbers are growing. You will realise that some Bills will be brought here that create certain institutions. Once they are created, they do not add value. Time has come for us to change our thinking. The other thing which we need to address is corruption in these organisations. Corruption is like cancer. It is eating into the fabric of the Kenyan society. Time has come for that to be checked. On the issue of appointments, we must look at gender, regional balance, profession and every facet, so that it represents the face of Kenya. We have bodies where we have people from the same family. For instance, when the National Cohesion and Integration Commission (NCIC) was investigating universities, they found that in one university, the Vice-Chancellor and the chairman of the cleaners come from one community. They also speak the same language yet we 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.

are told universities are the best places for learning which have the best thinkers and academicians. What people do there is shocking. I am sure the Institute of Directors will come with rules, regulations and bylaws to make sure that things are done properly and professionally so that we can move ahead. Time has come for us to change. In the days of the Kenya African National Union (KANU), illiterate people were being appointed as members of boards of directors. We had directors like the late Mulu Mutisya and Kariuki Chotara, who were illiterate, sitting in boards. They could not understand what they were doing there. They could not speak English or proper Kiswahili or understand what was going on. We have come a long way. We must look at the history of this country. Where did we go wrong? The other example is Kenya Railways. Since Independence until the Standard Gauge Railways (SGR) began, we did not have any other railway line. Seventy years ago when colonialists were here, we were able to do good things. What happened when the African Government came in? Those are things that we must ask ourselves. Are we adding value to this country? This Bill should bring sanity. I support.

Very well. Let us have Hon. Amina Abdalla.

Thank you, Hon. Temporary Deputy Speaker. I beg to support this Bill and congratulate Hon. Ochieng for bringing it. Let me focus on parastatals because that is where we are having the biggest challenge. The problem with our parastatals is that there is no oversight. Individuals are appointed as directors not based on meritocracy. They are there with a lot of conflict of interest. After I read this Bill, I was wondering whether we are addressing the symptoms or the causes of the problem. I believe that after dealing with the symptom, which is the fact that most of these directors of boards do not really know what their role is and they need continuous training as proposed by Hon. Ochieng, we also need to address the appointing authority and how to censure that. If a person is unsuitable, we need to stop him or her from getting into that institution. It is because of that, that I think Hon. Ochieng and the House at the Committee of the whole House stage need to amend Clause 25. If it is voluntary, it means that you will only be punishing those who have joined the institution and not everyone who is a member of board of directors. In my opinion, we will need to amend Clause 25, so that a director cannot serve in another board if he performed poorly or caused losses in an institution that he or she had served before. This Bill is too voluntary and should be tightened so that we can address the issue of professional board members who kill institutions, another Government comes, they are appointed into better parastatals and they also kill them. It is a vicious cycle. Whereas it is giving an opportunity to people who might not necessarily have that specific technical or managerial skill when joining the boards to be trained, so that they are better at management, we must accept that there is a big weakness in this Bill. It is voluntary and the Government of the day will not have to check that these individuals are members of these boards and problems will persist. Our biggest problem is that we have directors in boards who want to be contractors and usurp the powers of tender committees. When the CEO is powerful as Hon. Chris Wamalwa said, some of them use the board of directors as rubberstamps. There is a converse as well. When the board is made up of very powerful individuals, the CEO is a mere rubberstamp. The issue of checks and balances is not happening. Can that be solved by mere training? The answer is no. Training will help especially when we have punitive measures working across the board, 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.

that no director who is not a member of the institute and has not gone through the training will be appointed. That is when it will work. Accountants that are trained at the Strathmore University are scared of being involved in corruption because they know they will be blacklisted and will have a bad name. The institution will also follow their bad conduct. This Bill, therefore, just proposes to blacklist individuals yet it has no power to enforce the blacklisted individuals not to get another opportunity to bring down an institution. We, therefore, need to strengthen this. Government entities have a tendency of fighting good ideas because it curbs their powers to appoint. The Committee of the whole House is the right place for us to ensure that we give teeth to this institution that individuals do not serve in parastatals if they caused harm elsewhere. As we look at issues in this Bill and look at the fact that Mwongoz o is a mere policy and needs to be institutionalised, we need to appreciate the checks and balances between the CEO and the board members, as I have just mentioned. In fact, the people we should be dealing with are the Principal Secretaries (PSs). They are the ones who are influencing the boards and playing games between the CEOs and the board members. We need to address that because in many cases, you see a CEO being run out of office. Any time I read in the newspaper that a CEO is being chased away from an institution by the board, I always wait for the next step. If the next step does not involve that CEO being called to Integrity Centre, I always know that the CEO is a victim of boardroom fights over procurement. We need to go further than just making sure that members of the board of directors are trained, but know what they are supposed to do and they come to the boards with clean hands, less conflict of interest and further deal with the pseudo oversights. The body is supposed to be an oversight one, but it appears that they have three or four levels of pseudo oversight that influence how this board works. Maybe, we should be dealing with institutionalising mwongozo by fixing this body and all those other bodies that serve as watchdogs. There are many situations where the more you bring down an institution, the easier it is for you to get a bigger role. We probably need another one for CEOs such that if audit claims you are making billions, you all of a sudden leave that institution and later on the audit turns out to be false, there should be a way of following them up. We need not necessarily go the way of Mumias. These other institutions are basically talk shops. Nothing happens to the individuals. It looks like all you need to do is unmask a lot and then you will do away with it. As Hon. Chrisantus Wamalwa said, as a country, we need to implement the Abdikadir Report about rationalising our parastatals. The reason why we are not able to rationalise our parastatals is simple. People look at the positions of board membership and CEOs as a source of employment. If you try to rationalise institutions which are in many cases performing functions that are not within their constitutional mandate, people from the regions where the CEOs come, or people who have been appointed board members, would come out fighting without looking at the bigger picture. This is a strain on our national resources. We need to cut down the number of parastatals. I agree with Hon. Wamalwa that rationalisation should happen on the first year of any administration, so that we do not have politics creeping in and reducing our capacity to make bold and clear decisions. If we do that, we will save a lot of money and channel our resources to the areas they are needed most. I am very excited because I have had the privilege of reviewing this Bill, which seeks to establish this professional Institute. It does not cost the Exchequer any money. I am dealing with 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.

Hydrologist Bill and the foresters want a Bill to regularise their work, but all of them want the Exchequer to pay for their boards. This Bill is good.

Your time is over, Hon. Amina. I give the next opportunity to the Member for Kaiti.

Thank you, Hon. Temporary Deputy Speaker, for giving me the opportunity to contribute on this very important Bill. From the outset, I would like to congratulate my colleague, Hon. Ochieng, for bringing this Bill to the House. It is timely. The main intent of this Bill is to provide a framework for building capacity and training of directors. In this country, very important bodies have been overlooked, particularly directors who sit in boards of parastatals.

Order, Members! Hon. Mahbub, there is a lot of consultation around you. Proceed, Hon. Member.

Hon. Temporary Deputy Speaker, once the proposed Institute is formed, it will regulate the management of public bodies. It will bring on board policies that will aid better control mechanisms within public institutions. There is an international organisation called the Organisation for Economic Cooperation and Development, which was established in 1960 and it helps Governments to tackle economic, social and governance challenges. Its main objective was to promote policies that will improve the economic and social wellbeing of people around the world. If the Institute of Directors is set up in Kenya, there will be a paradigm shift in the management of public bodies in this country. The way things are done in this country is worrying. You find a CEO and members of the board of directors of a certain parastatals embezzling public resources without any effort being made to stop them. The habit has crippled many public organisations. The perpetrators of this vice do not consider the effects of embezzlement. They end up running down the organisations. The proposed Institute will put in place policy guidelines on how people who are appointed to serve in public institutions should behave. The core principles of corporate governance are integrity, accountability and the capacity of an individual to run an organisation effectively. This Bill has come at a time when we are witnessing very key companies in Kenya being run down. The effects of running down those companies will be devastating. Many people will lose their jobs. There is imminent strike or go- slow by KQ pilots because of what is happening at KQ. We take pride in KQ for being the pride of Africa. If the company is run down, it will be a shame for Africa. The KQ is one of Africa’s most admired airlines in the world, but because of poor governance within it, it has brought shame to this country. I support the establishment of the Institute because it will bring on board skills in the corporate world. Once registered by this Institute, then you must adhere to the set ethical principles. You cannot just move into an organisation, run it down and then move to another organisation. Kenyans will have to completely change the way they do things. The Organisation for Economic Cooperation and Development (OECD) was established in order to restore confidence in markets and make institutions function better. If this Institute is 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.

established, it will monitor how Government institutions are run. It will restore confidence in some companies like Mumias Sugar Company and KQ. Madam Speaker, there are different stakeholders---

What did you say, Member for Kaiti? You have to address the Chair in the right manner.

Thank you, Hon. Temporary Deputy Speaker. I stand guided.

You cannot confuse that voice with any other voice.

Hon. Temporary Deputy Speaker, I stand guided. Some organisations like Mumias and KQ have different stakeholders. Being public, the companies have shareholders who hold ordinary shares. In some organisations, there are preferred shareholders. In the event that a company becomes insolvent, the first victims to suffer the effects are the ordinary shareholders. Preferred shareholders are given preference in terms of compensation. It is important to restore confidence of this country in the management of institutions. This Institute has come at the right time and with it, this country will move forward. Some organisations will be very careful not to appoint directors of questionable characters. With those few remarks, I beg to support this Bill.

I am mentioning this because I realise they are all from one side. We will hear Hon. (Ms.) Fathia, Hon. (Ms.) Wanjiku Muhia and Hon. Nakara, in that order. Hon. Nakara, you will be the third one after Hon. Mahbub and Hon. Muhia. I realise you pressed your button. Put it at the intervention slot.

Thank you, Hon. Temporary Deputy Speaker, for giving me this opportunity. I want to thank Hon. David Ochieng for bringing this Bill, which has come at the right time. We have many parastatals in Kenya, majority of which are not making profit. They make losses because of bad governance. This Bill has come at the right time, so that this institution can train directors to be professional. Many parastatals like the Mumias Sugar Company, Uchumi and the National Bank do not even make profit because of lack of commitment. We have CEOs who dictate to the board of directors because the board members do not understand their role. They are used like rubberstamps because they do not know what they are supposed to do. They are supposed to look at the proposals, critique them and give their suggestions and even challenge the CEO, but because they do not understand their role, they are used as rubberstamps. This body should have the right people who are capable, professional and ethical. We have many corrupt people, but there is no institution that can stop them from moving from one institution to another. With this Bill, you must have certain qualifications to be a member of a board in a Government parastatal. This Institute can also be used by private companies and sole proprietors. There are directors who run family businesses, but rarely understand how to carry out business. Kenya Airways has shown a very bad example. Kenyans were very proud of KQ, but today, at the rate it is going down, it is even worrying that a lot of pilots will go to other companies. They are losing a lot of good and experienced staff. It is high time we looked into the issues affecting KQ. Once this institution is set up, it should have the right people with high integrity. We should have directors who can run an organization and not people who are appointed because they belong to a certain tribe or who look at things through the ethnic lens. We must come out of 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.

that. We are in the 21st Century. Let everybody be judged according to their education, performance and experience. I support the Bill.

Thank you very much, Hon. Temporary Deputy Speaker, for giving me this moment to speak about this very timely Bill. I know Hon. Ochieng is a great contributor and sponsor of several Bills. Today, Kenyans have one question. We are informed that some years back, we were economically at the same level with Singapore. What happened and what continues to happen only requires such framework to make us dream to ever be there. This Bill can be used to cure corruption in this country. The country has endeavoured to cure corruption, but it has become a nightmare. This is a very good Bill that the country can ride on in order to get to zero-tolerance to corruption. A CEO is the vision-carrier of any company or parastatal. In Kenya, we have all these examples Members have mentioned. When we look at boards of directors, we are left with several questions. Someone once wrote that a CEO can be competent, but not credible and a CEO can be credible, but not competent. The question is whether we have CEOs who are not competent or CEOs who are not credible. We can get answers from the existing companies. A bank like Equity has continued to excel while banks owned by the Government continue to be bailed out day in, day out. These can be referred to as CEOs who may be competent, but deliberately driving these companies down. The issue of training is good although not really the cure. I want to draw the attention of Members that capacity building is necessary and that we need to invest in it. I want to draw their attention specifically to Kenya Airways (KQ). When a Chief Executive Officer (CEO) or a board of directors sit down and make a wrong Memorandum of Understanding (MoU) with another company, for instance, KLM ---

Hon. Members, sitting here, I really want to dissuade you from continuing to speak too much about KQ. We have already spoken enough about it. Sometimes, there are things that are not very useful in trying to help a company like that one, if we speak too much about it. We have had quite some time to speak about it. I am urging Members to avoid it. I am short of making an order in that line. Let us speak along other lines. Let us leave KQ for now.

Why?

Order, Members! If you push me, I might make an order on that issue and I do not want to do it. It is good to avoid talking about some of those parastatals. You might actually cause more harm than help.

Hon. Temporary Deputy Speaker, that is quite clear. I will go by your direction. Let me then say that when company “X” enters into an MoU with company “Y” and the MoU is meant to drive company “X” down, that is not lack of competence from the CEO but lack of credibility. I want to draw Members’ attention to the disciplinary case in this Bill that the country can use to be zero-tolerant to corruption. I want to assume that the member of company “X” who writes a wrong MoU with another company to bring down his, clearly, may not have the relevant training. Why? He does not see that billions of shillings are going to be lost when that company goes down. He is not looking at the job opportunities which are going to be lost when the company goes down. He is not looking at the medical care, the roads, communication and education that are supported by the income tax collected by the country when the company is running well. Most important is the disciplinary issue. I am of the idea and view that once a CEO of a board member is blacklisted, he should not just be given a certificate 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.

for him or her to be relocated to another parastatal. That person should be blacklisted for a period of time. It is like the banks impose sanctions on those who default on the repayment of loans. They blacklist defaulters for a period of five years before they can be given another loan by another institution. The same case should apply here and, possibly, the period should be extended to 10 years. For bringing a company down, you should either be blacklisted forever or for a minimum period of 10 years. We have seen some very funny CEOs who have brought down companies being transferred to others which they also bring down. We can go a little bit further to the political platform. We have seen the same CEOs going to the counties to seek jobs as County Executive Committee (CECs) members. Those are the people who have brought down counties. We have seen some of those people seeking to be elected as county governors. A governor of a county is the CEO of that county. If that is a person who has brought down a company and he pleads with the electorate to elect him as the governor of the county, he will still bring that county down if he is elected. So, this is a Bill we can use to minimise corruption mainly by blacklisting people without any mercy. We should blacklist them to the standard of the Chinese - like what one Hon. Member has mentioned. I also want to bring out the issue of reality. We do not live on the moon; we live here in Kenya. There is the issue of face of Kenya. I wonder what it is. I have seen a list from Hon. Kaparo and his team trying to say that a company is headed by a group of people, or that this company has this number of Kikuyus or Luos. We must be real here. I take this opportunity to air this. A company in Kisumu which processes fish cannot be led very well by Wanjiku from Murang’a or Nyandarua. That is because she may not have any idea about fish. In fact, the workers may want gloves to handle fish and I may not even understand that. A company in Murang’a which processes tea may not be led well by Otieno from Kisumu. That is because he may not have an idea of how tea is handled. As we continue to talk about the face of Kenya, we must also be realistic that we do not live on the moon. We live here in Kenya and the reality of the region and of companies based in specific regions has to be observed. We have to live by it. We also have to look at the percentage of the citizens of Kenya. We have to know how many Kikuyus are in Kenya so that when you say that 20 per cent of employees in that company are Kikuyus, you have to relate that to the number of Kikuyus in this country. When you speak about a percentage of Luos in a company, you have to ask how many Luos are in this country. Hon. Kaparo and his team have to look in that direction. Most importantly, if a company is in a certain region, I will continue to support that members from that region benefit more than the outsiders. It is provided for in the Constitution. Even the county governments are mandated to have 70 per cent of the employees coming from the county, while 30 per cent can come from other places. With those few remarks, I support this Bill. When it will come to the Committee of the whole House, I will propose some amendments.

Do you have an issue, Hon. Oyoo?

Yes. I wanted to caution my respected colleague that this Bill is about directors. It is not about balancing of tribes. When the time comes, we will advance insurmountable arguments that will outweigh her argument.

Actually, you are right. In fact, the issue of balancing communities and regions is already well covered in the Constitution. But it does not harm if she spices up her contribution by bringing issues like that on board. However, that is well set out in the Constitution. 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.

On a point of information, Hon. Temporary Deputy Speaker.

To who Hon. Shimbwa? No information is required, at least, not on my part. Actually, I am the one who is going to inform you that I am giving you an opportunity to speak just before Hon. Nakara, for purposes of balancing the House. So, Hon. Nakara, will be next and Hon. Shimbwa can now inform the House generally through your contribution and not specifically to me.

Thank you, Hon. Temporary Deputy Speaker for giving me this opportunity to contribute to this important Bill by our colleague Hon. David Ochieng. In fact, one big problem that we have in our country is notational and attitudinal. You will always hear comments to the effect: “Do not mind if you fail in your bid to be elected. The Government is big. It will accommodate you.” Those are the people who are appointed to parastatals as directors. This Bill is important and timely. We need to weed out directors who have no qualifications and background knowledge of whatever institutions they have been appointed to lead. I know members of certain boards like Kenya Ports Authority (KPA) who were appointed just because their kinsmen are well placed in society. I have been made to understand that those people have never contributed in a single discussion until, sometimes, when the chairmen request them to say a prayer as a contribution just because they have never been heard. So, if that is the situation in an organisation such as KPA, we are headed in the wrong direction. Hon. Temporary Deputy Speaker---

I do not want to interrupt you, but I am convinced that even prayer is a very useful contribution. Proceed anyway.

Hon. Temporary Deputy Speaker, some board members have been appointed and the only thing they do is to act as brokers for tenders and other funny things. I know of an organisation in Holland – it is an equivalent of our Kenya Ports Authority (KPA) - which is in charge of port affairs in the whole country without any government interference and it is doing so well. I do not know why our organisations are not performing. There must be something wrong in the running of our Government. One way of assessing the performance of a Government is through its institutions, for example, parastatals. There is need to determine how they are performing and in case they are not performing well, then, perhaps, we need to pass a vote of no confidence in the Government. I am saying this because those institutions play a very critical role of contributing to the Exchequer. If nothing serious is done, we will keep on mentioning Mumias Sugar Company, Kenya Airways and so on. That will not help the country in any way. I am proud to have brought a Motion on Kenya Airways, although this House decided to silence it. I am happy that the Motion contributed towards the knowledge of the rot that is affecting KQ. I would like to plead that an audit be conducted on all those institutions. We need to know, for instance, the members of the various boards, their qualifications, background and contribution to those institutions. We should take deliberate steps to correct whatever went wrong so that, at least, our institutions can contribute to the Exchequer. I am saying this because I know if those organisations perform well, then we can stand a better chance of creating employment for our youth. We know the issue of unemployment is causing a lot of stress in the Government today. We have many students with two degrees, but they have no employment. I know of students who have completed studies at the Kenya Medical Training College (KMTC) 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.

but they have no jobs. This is a matter that we should take seriously. This can only be addressed if we take into account the fact that parastatals and other public institutions are supposed to expand opportunities for our people to get employment and, hence, better their living standards. You are aware that today, Kenyans are living in abject poverty. Most of them cannot afford school fees, healthcare and even a single meal. This trend can only be addressed if we take serious measures, for example, by making sure that this Bill is supported. The Government should be made to take serious steps in addressing the issue of run-away corruption. It has been permitted and even our lawyers have made it possible to happen so that they can get rich. I am saying this because anybody who steals will always run to the top lawyers and they will never get arrested or be taken to prison. They will be saved. We continue to read in the Press about the National Youth Service (NYS) saga and many other sagas. However, we can be sure that nobody will be arrested. Those scandals end up being history and will only be mentioned by, say, a Member of Parliament in passing. I urge my fellow Members to make it possible only for people with integrity, technical expertise, valid and relevant educational qualifications to be elected or nominated to those boards. That way, we will have in position people who can serve the purpose they have been intended to serve. With those few remarks, I thank you for giving me this opportunity to contribute. I beg to support.

Thank you, Hon. Temporary Deputy Speaker. I would like to join my colleagues in supporting this Motion. First of all, I would like to appreciate and acknowledge the knowledge of Hon. Ochieng who came up with such a good idea that will make our country better. The reason for putting in place this kind of institution in this country is to build the capacity of directors. They may have got appointments through political means or connections, but what is very important is building that capacity. That way, they will be in a position to run those institutions in the right way. It does not matter where one comes from or their tribe. What is very important is that one brings transformational leadership in the institution he or she has been appointed to head and turn it into a business-oriented one, so that public money benefits the public.

The second point I want to put across is on discipline. Our CEOs, directors and other leaders must be taught discipline. You cannot be a leader without discipline. What leads to corruption is indiscipline by people whose integrity is questionable. When we have such kind of people in leadership, then the institutions they head will fade automatically. The other reason of having that institution is to bring uniformity. Many parastatals have different ways of doing their things. In terms of the salaries and allowances for the CEOs and directors, some parastatals pay higher than others. That institution will make sure that there is uniformity in our parastatals so that they can be run in a disciplined manner. It will also ensure that they are business-oriented. Another issue is good governance. Good governance is all about resource mobilisation. 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.

Those directors must be taught how to mobilise resources locally and internationally, in order to make those parastatals run. When we talk about good governance, it is about transformational leadership. You transform the institution and take it to the next level. It is shocking when some people are appointed to head institutions and then after some time, they run them down. Such kind of directors must be expelled or disciplined by those institutions. They must not be appointed ever to run any other institution. If we do that, we will surely bring discipline and uniformity in our institutions. When we talk about a profit-oriented parastatal, we really mean it. Whatever we invest in a public body, we expect outputs. Outputs must benefit the public. Most of those institutions are run using public money. Members of the public expect good services and profit. They expect those institutions to generate some income for the country. On professionalism, directors must be appointed according to their professional qualifications, so that they can take their experiences and knowledge to our corporations. We should not use politics and tribalism to appoint directors because we will spoil our institutions. We should appoint people who have retired from active service, but who are professionals. Such people will take back their knowledge and experiences to our institutions. When you pick up a young man with neither experience nor academic qualifications and appoint him a director, you are misusing him. Directors must have rich experiences in the areas of operations of a State corporation. We want people who bring change in our institutions. We should open up the proposed institution to everybody so that even people in the private sector can be brought in, if they so wish to join. The proposed institute should be a training institution. It is not a must that one must end up being a director once you are trained there. One can acquire knowledge, which he can apply in his private organisation. I want to request Hon. Ochieng to open up that institution to both the Government and the public, so as to train anybody who wants to be a good director. The major reason of having that institution is to instil good governance to our directors. Good governance should be practised by everybody. With those few remarks, I support.

(Hon. (Ms.) Mbalu): Next on my request list is the Member for Kwanza.

Thank you, Hon. Temporary Deputy Speaker. I want to thank Hon. Ochieng for bringing this Bill, which is essential for economic prosperity of a country.

The principal objective of setting up the Institute of Directors of Kenya is to enhance corporate governance. I am speaking from the knowledge I got because I was a Chief Executive Officer (CEO) of more than three companies and two parastatals in this country. This Bill is very useful in the sense that appointment of directors has always been done for various reasons. One might be appointed a director because he is a neighbour of the appointing authority, or because of political expedience. We should establish the proposed institute so that directors can go through formal induction on various businesses. They should have general knowledge on how companies or State corporations are run. Companies have objectives and business lines. I thank Hon. Ochieng for coming up with this timely Bill. Directors join companies for various reasons. There are those who come in to draw sitting allowances, which is possible because they will be working. Some join companies because they think that is a way of making businesses. That is a conflict of interest. That should be spelt out in the general knowledge when the institution will finally be set up. Some directors represent various interests. That should also be covered in the institution so that directors understand how to run companies. 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.

I have been to countries in the Far East, including Malaysia, Japan and South Korea. Their structures for setting up companies are quite impressive. The people who are appointed directors know their roles. In our case, directors are just appointed haphazardly. Members of boards of management in schools are normally picked because they are from the neighbourhood or were classmates of the head-teachers. We end up with mismanagement and misappropriation of funds. A company has a strategic plan that runs for, at least, three to five years. The plan has set achievable targets. If a director does not understand the strategic plan of a company, the company is more likely to fail. The proposed institution will give a head-start to some of the ailing companies. Recently, the Eveready Company moved from Nakuru to Nairobi. The directors of that company should be able to tell us why it was moved. There are cases where directors take part in deliberations on the company targets. The minutes are prepared so that they can go through them. If they do not understand the resolutions that are passed, then those companies will definitely fail. Directors should sign the resolutions and understand the way forward. For State corporations and parastatals, we have performance contracts. I was among the first CEOs to partake performance contracting. The performance contract is not being implemented the way it was when we were CEOs. We used to set targets. At the end of the financial year, one used to check whether the targets have been achieved. If not, one had to come up with reasons as to why he did not meet those targets. That became the basis for improvement in the following year. Directors should know where they are in order for them to move forward. The proposed institution will solve that problem. Some directors are given minutes and targets, but they do not understand them. Even with performance contracting in State corporations, parastatals and ministries, we were lost at some point. As we move to achieve industrialisation, the Government should revamp the Efficiency Monitoring Unit (EMU), which should be within the presidency. Are they monitoring performance? People in that unit should be able to understand the objectives of each public company and State corporation. Therefore, it is important for us to have those institutions so that we can guide the directors on how best the companies, parastatals or State corporations are run in this country. We have cases where directors dictate to the CEO on what to do. That is why we have problems in most institutions. When I was the CEO of one of the biggest parastatals in South Nyanza – I do not want to mention it for obvious reasons – we had directors---

( Inaudible )

Do not put words into my mouth!

(Hon. (Ms.) Mbalu): You are protected. Do not put words in his mouth.

I am proceeding very well, but I am being interrupted by my good brother, Hon. Richard, here. I was a CEO and the kind of directors we had, apart from the ordinary directors from the Ministry of Regional Development, were not helping the situation in that particular organisation. Why? It is because some of them had been picked just because of political connections. We had a parastatal that was supposed to be doing very well. Until I stepped in, it was going to the dogs. When I came in, we streamlined it. Today, you can even ask the former Prime Minister and he will have good words for me. That is because we streamlined that particular parastatal to be where it is today, or where it was by the time I left. We had new directors who had to go through induction to understand the objectives and direction to which that particular organisation was going. 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.

I support this Bill because it will bring a lot of changes. When directors are appointed, before they step into the organisation, they will first be trained on the general knowledge on how to run the parastatals. I support this Bill and I thank my brother, Hon. David Ochieng, for bringing it for the future of this country.

(Hon. (Ms.) Mbalu

Thank you, Hon. Temporary Deputy Speaker, for giving me this opportunity to contribute to this Bill by my good friend, Hon. David Ochieng. I stand to support the Bill because I feel it will bring some sanity in our parastatals and other public institutions. It will bring order, accountability and integrity into our public institutions. Our public institutions, especially parastatals, are going down by the day. Since Independence, we have had many situations of parastatals going down and others being mismanaged. The people who make them go down just go home scot-free. That comes about because most directors who manage such institutions are not knowledgeable on what they are supposed to do. Others are appointed because of political expediency. Others are in those particular positions because of their ethnic background. In the long run, the institutions either end up being run down or the Government comes in to put more funds so that the institutions can come back to life again. In the process, the taxpayers end up coughing up money through their noses not because of anything else, but because somebody somewhere was in a particular office either without the knowledge or knowingly going there to make some money. Most of our institutions, especially in the previous regimes, became cash cows. Parastatal chiefs used to get cash and give it to the people who appointed them to those positions, so that they can remain there. The politicians got that money for their benefit or to go and campaign or do other things. When they do that, the institution will just go down and somebody will come up and say: “Let us bail out this institution.” Yet, it had been stage-managed. That should stop. We should get directors who are properly trained and who will put in place an institution like the one that the Bill promotes. Qualified directors who are given the task of managing the institutions and they let them go down will be disciplined. Disciplinary measures should be spelt out and measures to recover the lost cash or properties of that particular institution should be put in place. It should be clear that those who sit in those boards as directors and managers should be people of integrity. They should sit there with the notion: “What am I going to do with this institution to make it better than I found it?” It should not be: “What shall I do to destroy this institution?” Some of them do not have the knowledge and they use the same money which should be promoting the operations of that institution to even buy the auditors. When the auditors go to audit, they give fake figures and “cook” the books and we are shown a very healthy institution once the balance sheet is produced. However, when you go deep into it, you find that the institution is already on its knees. Sorry to say those words because the Temporary Deputy Speaker who was on the Chair before you, cautioned that we should not mention Kenya Airways. However, I think that has 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.

become a thorn in the flesh in this country and we cannot fail to mention it. We have been seeing KQ as the Pride of Africa. Unfortunately, when the losses were put in the public domain, everybody was shocked with what was happening. We have Uchumi which has been going down. It had just been bailed out by the Government. It is going down again. Taxpayers’ money is used and the people who have made the parastatals to go down are appointed to other positions. Therefore, this Bill should include disciplinary measures against those people who make parastatals go down. They should not be appointed to any other public office so that it can be a caution to those who are intending to go in that direction. When board members are appointed, there should be proper vetting of the appointees. At the same time, proper training should be put in place and after you are trained and we find that you are not capable or you cannot qualify, then you do not need to be appointed to those boards. Therefore, it is of great importance and essence that we should really support this Bill and make sure that it is expediently implemented. Directors of any of our institutions must be people who have been pre-qualified and gone through the Institute. The people who will be vetting or training those members should also be beyond reproach. They should always be censored. They should not be people who favour people into positions so that they can make some financial gain. On the contrary, they should do their work for the purpose of promoting the growth of the parastatals in this country. That is what will make our country grow, move forward and not lag behind. We have been left behind by other countries which were with us at the same level of development. An example is Korea. Today, we are still limping when others are developed and have gone far. Hon. Temporary Deputy Speaker, I support the Bill.

Hon. Members, I have 12 requests on my list and I believe we all want to contribute to this Bill. There is an intervention from the Member for Kitutu Chache South. Is anything out of order?

Thank you, Hon. Temporary Deputy Speaker. I seek your indulgence. I want to thank this House and Parliament for allowing primary school children to come here to observe our performance. I am extremely excited because my daughter, who happens to be at Riara Primary School, is here with her classmates. I thank you and my colleague the Member for Muhoroni would also speak for himself.

Thank you, Hon. Richard Onyonka. We have always done the same for all the pupils from primary schools in this country and other visitors who come here. Parliament is open to all. I am happy for your daughter. Once again, I welcome the pupils and teachers from Riara Primary School. Let us have the Hon. Member for Matayos.

Thank you, Hon. Temporary Deputy Speaker. I also want to contribute to this Bill that has been sponsored by Hon. David Ochieng, Member for Ugenya. We are proposing to establish an institute for Directors of Kenya. This is going to help our organisations grow and be managed in a prudent manner. We already have institutes existing for professionals such as bankers, surveyors, human resource managers, architects and so on. It is, therefore, proper that directors also follow suit. We have seen many of our public organisations and statutory bodies collapse. In the 1990s, there was a divestiture exercise that was embarked on and it was as a result of corruption in this country. Directors did not have the knowledge and skills required to manage those organizations properly. The reason is that many 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.

of them were appointed based on their ethnic backgrounds or political correctness or other crude ways of appointment. However, that kind of institute to train directors on how to manage our organizations will cure the problems that we have had in the past. This will also affect our universities. Recently, we had a crisis at Moi University and we saw people clinging onto particular individuals. The reason is that they want to use others as cash cows. They want to divert funds that are meant for the development of educational facilities and research to financing activities of certain individuals, including campaigns for political positions. Hon. Temporary Deputy Speaker, I support this Bill because of the issue of capacity building and inculcating of values, knowledge, skills and attitudes that directors will need for them to get their job right. Before they get into directorship, they need to be qualified. The institute we are proposing will be best placed to conduct that training. It will be empowered to register and regulate the conduct and operations of the directors so that we do not have, in leadership positions, people who neither know what the organizations stand for nor care about the public. It is those kinds of people that we are targeting to get out of our institutions. There is the idea of issuing certificates annually to the members. That is good as it is a way of ensuring that there is quality. It is possible that one gets a certificate or is registered as a member and in years to come, one is devoid of the values that were initially required of them. The fact that they will be vetted, assessed and certificates issued to them annually will help because it will make them stay on course. They will then avoid the malpractices that they have been involved in before. It will stop that poor, archaic habit of appointing people simply because they belong to one’s community. It will stop the habit of appointing friends or people who have corrupted the appointing authorities. Lastly, the establishment of a disciplinary committee to discipline those directors who will have been found not to toe the line – this amounts to professional negligence and misconduct - is good. Wrong-doers must be punished for their misdeeds. They should be punished for not doing the job they were appointed to do. I would wish that this Bill goes further to spell out the penalties for those who are found to be culpable. With those few remarks, I support.

Very well. Let us now have the representative of the people of Westlands Constituency, Hon. Timothy Wanyonyi.

Thank you, Hon. Temporary Deputy Speaker for giving me a chance to contribute to this Motion. The world over, all successful business entities are very well managed by efficient boards that are professional and that are headed by competent people who have the requisite qualifications. Sometimes, our parastatals fail because people are appointed on the basis of political correctness. They get appointed not because they should improve those institutions, but because they intend to turn them into cash cows. So, that institute should have been put in place like yesterday. Through such an institute and others like the Institute of Certified Public Accountants of Kenya (ICPAK), we should inject professionalism in the appointment of directors of boards. Boards steer parastatals and corporate bodies to success. If you look at successful companies such as Safaricom, you will find that they have very efficient boards. Such boards comprise of professionals. Banks are supposed to be managed by people who are very efficient and who are expected to inject skills in the business. When such people leave the institutions, they also leave behind a very rich legacy. Look at the way Kenya Airways was managed before. What is happening now is because of lack of competency and efficiency. If you look at companies that are struggling, you will 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.

notice that something is lacking. When we get into jobs people who are qualified and competent, we will be able to develop our corporations. We will ensure that they do good business. Those corporations are supposed to make money and create wealth for us. The persons appointed as directors should strive to take those entities to higher levels. When we get to that point, we will never be worried about where a person who has been appointed as director comes from or which ethnic group he or she belongs to. If you look at the Central Bank of Kenya (CBK) right now, it is being managed very well because the person there now, Dr. Njoroge, is somebody who nobody can doubt his competence. He qualifies and has gone there with an independent mind. He is operating above board and everybody is happy with what he is doing at CBK. Before, there were some things that were happening that were not very good. You can remember in the 1980s and the 1990s when banks were collapsing because there was something amiss. So, we believe that when we have integrity, competence, professional academic qualifications and the track record of somebody, we are going to get people who are going to manage our institutions properly. Hon. Temporary Deputy Speaker, this Institute of Directors of Kenya Bill will bring a lot of improvement in the management of our parastatals and corporates. This is not just in the public sector. We are looking at the private sector also so that, that body can act as a regulator for professionals. Organisations like the Law Society of Kenya (LSK) manage and control lawyers. You cannot just behave in the way you want because there is somebody watching. When providing an oversight role, it will bring efficiency and competence in the corporate sector. I support and congratulate my brother, Hon. David Ochieng, for bringing this Motion. It is very timely. I am sure it is going to inject a lot of efficiency and improvement in the management of our corporate sector. Thank you, Hon. Temporary Deputy Speaker, for giving me an opportunity to contribute to this.

(Hon. (Ms.) Mbalu): Thank you. Hon. Rachel Ameso.

Thank you, Hon. Temporary Deputy Speaker. I want to thank Hon. David Ochieng for coming up with this Bill. As much as I support it, I was looking at it and I hope there will be some amendments. I was looking at the qualifications of the directors. Who is a director? Maybe, we need to know. We need to set a standard or standards to know the qualifications of those directors before they join that Institute of Directors of Kenya. You will agree with me that even lawyers have set their standards for joining the LSK. It is the same with the certified public accountants. They also have set standards and qualifications for you to be a member of their Institute of Certified Public Accountants of Kenya (ICPAK). So, I want to believe that he will look into that and give us the qualifications. I have seen how you can disqualify someone. But what are the qualifications that need to come with this? With qualifications, it will be a good Bill because it will look into issues of directors. We have quite a number of directors all over this country. Before we set the qualifications, it does not give you a clear idea. How do you get those directors? Who is a director in Kenya? How will we get those directors for that Institute? How will you go out there to identify the directors to come and join the Institute? What if those directors will not come out to say they are directors so as to join that institute? How will you deal with that case when they are not joining the Institute? So, we also need to look into some of those issues so that we can polish the Bill. 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.

I like the management of the institute. Who will manage that institute and what will be the qualifications of members of the board of directors? We need to set those standards so that whoever comes in knows there is a board with qualified members who are going to vet those who are coming to join the Institute of Directors of Kenya. I was looking at the best practices in the profession not only in public entities, but also in private entities. That is because they are the same people who keep changing from private entities to public entities. Having seen how they performed in the private sector, then we can bring them to public institutions. Quite a number of organisations are really struggling to survive. You will get quite a number of those directors from struggling institutes going to those that are doing very well and within five to ten years, every institute goes down. We need to vet who is going where and who qualifies. Just the same way we carry out vetting here in Parliament; we should vet those people before they join those institutes to be directors. We need to vet them through Parliament. When appointing directors, members will, through this Institute, check the character of those directors. They will also have to have previous records. So, it is good that the Institute will be established. It will have their previous records, what they are doing and how they are performing. It will also have their value addition from where they are working. It will be very important for members to know who they are dealing with. For example, if you want to know a good lawyer, you only need to go to the LSK and you will get the records of the lawyer and so you are free to deal with the person. The other good thing is the disciplinary committee. Once your character is questionable, disciplinary measures will be taken against that member and the certificate can be withdrawn. That member will not have any other opportunity to work in any other public or private institute in the country. I was also looking at the training. You can be a director for quite a number of years but, you cannot rely on the education or academic papers you got in 1970s. You need to know what the current trend of business is or what directors need to know and that means benchmarking. We also need to visit other countries to see how they operate when it comes to such an institute. It will be a good one because we shall be wetting standards. We shall have a training of those directors from time to time. They will be attending some seminars from time to time to see what is happening in the current times. So, we shall have management and training skills for those directors at institutions from time to time. We shall also have ways of how to regulate what shall be binding on all members of the Institute so that you do not just come up with your own regulations. We need to come up with regulations on how to control the Institute and those directors wherever they are. Those regulations must be followed to the letter. I have mentioned that the directors will need that capacity building from time to time, while knowing the trend of conducting business keeps on changing day by day. It will also be very important.Registration and regulation of the conduct of directors of various organisations will also happen at this Institute of Directors of Kenya. So, as much as I stand to support, I believe Hon. David Ochieng will look at the qualifications of those directors so that it can balance our Bill. Otherwise, I stand to support your Bill.

(Hon. (Ms.) Mbalu): You support. Let us have the Member from Elgeyo/Marakwet County, Hon. Susan Chebet. 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.

Thank you, Hon. Temporary Deputy Speaker. At the outset, I rise to support this Bill. It has come at the right time. We all know how our organisations are run. If we are given an opportunity to train and give more information and knowledge to the directors so that once they are appointed to those positions, they take care of our investments in those organisations, it will be good. There is a lot of investment in organizations. We put a lot of money and human resource in them. If we do not have the right people to run them, we will lose. We already know how much we have lost in terms of investments that we have put in those organisations. There are organisations that have collapsed due to poor management. I am sure when we have that Institute, it will train our directors to practise professionalism and good governance when they are running the organisations. Most directors have always been appointed on political grounds. We all know what political grounds entail. We just appoint people and rarely look at their qualifications. It is just recently that we started looking at qualifications. Previously, directors were appointed regardless of the qualifications and experience they had. This means they would always run down the institutions. The issue of corruption is thriving in our organisations because of lack of integrity and scrutiny of our directors. We have performance contracting, but some of the directors may not be required to sign performance contract forms. If they do not sign performance contract, then it means they do not have any responsibility at the end of the period that they have been given to run those organisations. We need business-oriented directors. They need to know that they have been appointed to run serious businesses in those organisations, so that they do not collapse. The organisations which are supposed to make money should do so. We have cited many companies in Kenya that were supposed to make profits, but have failed and now the Government is bailing them out due to poor management. The training should sensitise the directors who are going to be appointed to look at the organisations they are going to run as business entities so that they can make profits and take care of both human and financial resources. We know of organisations which have a bloated wage bill. It is because they are not sensitive in terms of recruitment. They recruit relatives and people requested by politicians. This means they will employ people without looking at the wage bill. If the wage bill is higher than the money they make, it means they are going to incur losses and they are going to have a bloated human resource. A director should have a wide knowledge of management and be of high integrity. With those few remarks, I support the Bill.

(Hon. (Ms.) Mbalu): Hon. Ngéno, I know you have now decided to contribute. You can now make your contribution.

Thank you, Hon. Temporary Deputy Speaker. I thank you for allowing me to speak when you want. I wish to support this Bill given that its Mover gave a comprehensive explanation as to why he wanted to create the body that will be dealing with matters of directors of parastatals. The major intention of creating those parastatals was based on genuine reasons. At that particular moment, we only had ministries which were running the affairs of the Government. With time, they realised that those particular ministries also had several departments that needed to be dealt with independently. That was because we had so many issues in our country that needed proper attention from the Chief Executive Officers (CEOs), other than Cabinet Secretaries (CSs) and Permanent Secretaries (PSs) of those particular days. The immediate creation of those parastatals brought a lot of fruit into this country, especially the ones that were dealing with farmers. It is only after sometime that those parastatals began to collapse because of mismanagement, nepotism, corruption and so many other issues 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.

that people brought to them. The appointment of board of directors was a big blunder. With the creation of those parastatals, the first issue would have been the regulations which were meant to be put in place so that when we are making appointments of directors, we do it diligently and with proper qualifications so that we have the right directors in those boards. One of my colleagues spoke about the board of directors in most of private companies and private banks. Those institutions pick the most qualified directors to run those private banks and companies. Unless under peculiar circumstances, you will not find those private banks or companies collapsing because of mismanagement by the boards. I think our boards, especially of parastatals, have been turned into political campaign tools, so that people who just get appointed in those particular positions are people who are thought to be politically correct, but are not completely qualified to run them. The creation of that particular body which will continuously look into the qualifications of directors and especially train the directors on particular positions they are holding in the parastatals will go a long way in streamlining the parastatals. Hon. Temporary Deputy Speaker, parastatals play a huge role in our economy. We have more than 300 parastatals which, with independent CEOs, play a major economic role in our country. Only half of them are moribund and others are surviving on money they get from the State.

On a point of order, Hon. Temporary Deputy Speaker.

(Hon. (Ms.) Mbalu): Hon. Ng’eno, I have an intervention from the Member for Alego Usonga.

Okay.

Hon. Temporary Deputy Speaker, I rise under Standing Order No.95. Whereas there is a lot of interest in this Bill, I think it has been debated exhaustively and Members are just repeating themselves. Could the Mover be called upon to reply?

(Hon. (Ms.) Mbalu): The Member for Alego Usonga, before I come to you please allow the Member to, first, finish his business. However, you are quite in order. Proceed, Hon. Member.

Thank you, Hon. Temporary Deputy Speaker. It is very important that we create this training institution where directors will belong. It is also important that we look for ways of making parastatals work properly for this country. That way, they will benefit farmers and people in other sectors where each parastatal serves. We must also ensure that the regulations that are used in appointing directors are made clear so that even if one is to be appointed politically, we can have people who are qualified to run parastatals. Another issue that a member touched lightly is that State parastatals have been turned into tribal companies even though another member disputed that fact. I am happy for Hon. ole Kaparo, who came up with a condemnation list on how State parastatals have been turned into tribal companies. I am not happy that if you look at almost every parastatal, you will see that there is a certain community which occupies between 80 and 50 per cent of the employment places against the Constitution of Kenya, 2010. It is not good to try and justify that scenario by saying that we should look at the percentages of those communities in the Republic. We do not care whether you are 50 per cent. Being 50 per cent of the population of the Republic does not mean that you should occupy 50 per cent of the positions that are available. Some of these people are not even ashamed because they occupy the presidency. They want to occupy all the other employment slots that go down with it. Why not allow other communities to occupy the rest? What is the purpose of being the President? You want to be the President, the 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.

CEO of every State parastatal and the head of every ministry. People should be ashamed. Kenya belongs to all of us. I do not support the thinking that “because the Government is ours, it is our time to eat”. The other day somebody was quoted saying in public, “Sisi tunakula nyama, nyinyi munamezemate. ” The “ nyama ” that people are eating belongs to this country, and not an individual. It does not belong to one community but it belongs to the whole country. The “ nyama ” that people are talking about is paid for by this country’s taxpayers. We pay for that “ nyama ” through the taxes we pay to the Government. We want the whole country to benefit---

Hon. Ngeno, restrict yourself to the business before the House.

Hon. Temporary Deputy Speaker, I am sorry. If you look at the way some communities have occupied almost all the senior positions in some State corporations, you wonder why other Kenyans have been left out. How do you expect other Kenyans to behave when not even a single member of their community has been appointed to head a parastatal despite the fact that they also pay taxes? These are the things that make us feel bad. At times I feel unhappy when my county is completely excluded from running parastatals despite the fact that we are citizens of this country. We need to have equal opportunities. The Constitution talks about equality, regional balance and ensuring that there is no single community that occupies almost every public office in the country. I am not the one saying this; it is the Constitution of Kenya, 2010. Therefore, as much as we want to clean up the mess in parastatals, we must also deal with corruption, nepotism and tribalism. I urge Hon. ole Kaparo to take this matter to court and ensure that communities that currently occupy 50 per cent of the positions in any parastatal are removed from office so that other Kenyans can be appointed. I was once a director. What I saw in those areas made me unhappy. I would have liked it to be changed so that other Kenyans who have Kenya’s interests at heart and are properly qualified, can run those parastatals and do good things for this country. With those remarks, I support.

(Hon. (Ms.) Mbalu): Hon. Members, I have nine requests but only the Member for Seme will make contribution to this debate before I put the Question to the Motion that has been rightly and procedurally proposed by the Member for Alego Usonga. Thereafter, the Mover will reply. Proceed, Hon. Nyikal.

Thank you, Hon. Temporary Deputy Speaker for giving me the opportunity to be the last to contribute.

(Hon. (Ms.) Mbalu): Hon. Member, you are not the last. The House will make a decision. However, just carry on.

Hon. Temporary Deputy Speaker, the way I see the mood of the House, it maybe so. The key is the role of directors in the management of public and private institutions. If you look at commercial institutions and Government parastatals, you will find that all of them need direction and guidance from competent directors so that these institutions can deliver what they are expected to; be it profit in the private sector or service in public sector, which sometimes expect returns. This in turn is the foundation of the economy of a country at every level. The net effect is that the economy of the country is running. They are actually the key drivers of the economy. In the public sector, for example, you can get benefits reaching the people who put governance into 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.

power. In the private sector, benefits would go to the shareholders. We cannot say what their role entails in the public domain and the economic stability of a country. What do we experience in this country today? To a large extent, we are actually seeing a general failure at that level. Large Government parastatals are actually going down. We do not want to mention names but they are actually clear. It is not as if the people who are running them eventually get any sanctions against them. They run down the companies they have been appointed to head. They are then moved to the next company or given political positions. It is sad that some flagship companies have “died”. Companies that have been the kingpins or foundations of certain production areas have “died”. Often nothing happens because to a large extent, we have not looked at the competence and integrity of the people running these companies, namely the directors. The situation is made worse by corruption, nepotism, political interference and appointment through political consideration and yet there is no clear criterion, in terms of qualifications and integrity, requiring the appointing authority to consider before appointing somebody as a director. The only sanction often left to us is to go through the legal way. This will enable us to find out what went wrong. What is it that led to companies’ collapse, which in turn let the country down? If it is through procurement or banking or whatever they did, a solution must be found. Quite often, legal processes do not work because they are totally incapacitated and weakened by collusion. In a perfect collusion, you can never get anything done because the people appointed in those positions safeguard and collude with criminals, the legal and the security systems. There is no known remedy for a perfect collusion. In a perfect collusion, every person who is supposed to be a safeguard will give you evidence. The best was the Goldenberg scandal. There was paper evidence that gold was being produced; processed; actually passed through the airport and money was coming back. Everybody in the team was part of the collusion. Therefore, there was not much that could be done at the time. It is, therefore, important that we bring a regulatory element into the selection of directors and their functions. I support this Bill because it brings in the issue of registration of directors. There will be criteria for registration, qualification and capacity. It also brings in disciplinary measures that can be taken, which will be of a professional nature so that people can for once be sanctioned professionally. Whatever the profession they are in, they cannot practise in the profession thereafter if they have shown lack of integrity or competence. The Bill also brings the element of training. That is extremely important because the positions of director, which is an issue we can discuss later--- There is no known profession where you can say the people who are going to be directors. You can have engineers, medical doctors and lawyers as directors. There is, therefore, some form of training and capacity building so that when they are in a position where they are in charge of the overall management of institutions then they will do a good job. Of course, it is important that one has core competence in an area. For example, if an engineer is running an engineering company, he or she will do better if he or she has further training in management. It has been argued in management that anybody can be a manager anywhere, but from my experience, if you have a core competence and management skills, then you do much better. Hon. Temporary Deputy Speaker, I have issues that we will look at with the Mover of this Bill. I congratulate him. We need to look at clauses 21 and 22 which provide for the qualification of members of this Institute. It has not come out clearly how members will be picked. The clauses say:- 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.

“21. The Board may establish a membership committee which shall be responsible for vetting of membership. 22. (1) Subject to this section, a person is qualified to be registered as a director if the person holds a qualification approved under subsection (2) by the Board. (2) The Board may, by notice in the Gazette, approve qualifications which it considers sufficient to allow a person to be registered, and may, in like manner, withdraw any such approval. (3) Despite subsections (1) and (2), the Board may require a person making an application for registration to satisfy the Board, in such manner as it directs, that his or her knowledge of corporate governance and public administration or professional conduct and general character has been such as in the opinion of the Board to make him or her a fit and proper person to be registered, and unless that person so satisfies to the Board, he or she shall not be treated as being qualified to be registered.” The problem we are likely to have, and the Mover is here, is that it is basically left to the Board. It would have been better if we had clear criteria drawing from other professions on the qualifications one needs to have. That is extremely important so that it is not left only to the whims of the Board. Clause 7 establishes a Board to run the Institute. The Board will have members, but it is not clear how these members will be appointed. Clause 7(3) indicates that there will be a general meeting. It is not clear at this point who will convene the general meeting. There is also provision for honorary membership. Again, it is not clear who these honorary members should be and how they will be picked. If we can streamline those areas, this Bill will take us a long way in trying to improve---

(Hon. (Ms.) Mbalu): You support. Hon. Members, the Member for Alego Usonga rose under Standing Order 95 on closure of debate. This is not an abuse of the proceedings of the House. I, therefore, put the Question that the Mover be now called upon to reply.

Hon. Temporary Deputy Speaker, (i naudible )---

(Hon. (Ms.) Mbalu): Hon. Oyoo, you always want to be visible. Your voice is high but you are few. Let us have the Mover.

Thank you, Hon. Temporary Deputy Speaker. Before I reply, I would like to give---

(Hon. (Ms.) Mbalu): No, Hon. Ochieng! I must inform you that you cannot donate your time.

Thank you, Hon. Temporary Deputy Speaker. I want to thank Members. Indeed, I am very grateful to the hon. Members who have contributed to this Bill. I humbly note most of the recommendations made by--- 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.

On a point of order, Hon. Temporary Deputy Speaker.

Hon. Temporary Deputy Speaker, can the Hon. Member allow me to talk?

(Hon. (Ms.) Mbalu): The Member for Muhoroni, do not rattle a snake!

Hon. Temporary Deputy Speaker, with humility, I would like to know under which Standing Order we are gagged from getting donated time. The norm in this House is that the Mover has the freewill to donate time to a few Members. I have been on the queue for hours.

(Hon. (Ms.) Mbalu): The Member for Muhoroni, the debate was prematurely closed. You are a third-term Member. I told you not to rattle a snake. Allow me to inform you that since the debate was closed prematurely--- It was a Member who moved such a closure. Therefore, the Mover cannot donate time. If debate went up to the last minute as prescribed, at that point the Mover could donate time. Are you informed now? Are you satisfied?

With a heavy heart, I am not in the practice of opening controversy with the Chair. I am always loyal. I would have wished to contribute to this Bill because I am a dissenter.

(Hon. (Ms.) Mbalu): Thank you for understanding. It is in your Standing Orders which you can refer to. Proceed, Hon. Ochieng.

Hon. Temporary Deputy Speaker, dissenting is okay. I was saying that I am very encouraged by the comments made by my colleagues on the content of this Bill. One of the most encouraging comments I have got is with regard to the original Bill I drafted that required that we put, at least, some teeth into this Bill. It would require that even if you are not a member of this Institute, as soon as you are appointed to a public body, you become a member and you must attend some training before you assume your position in the board. This will go a long way in trying to bring sanity to this sector. I also note comments on firming up areas on qualifications, how members will be recruited, managed and who calls the first meeting. I promise that as members work on how to make the Bill better in the Committee of the whole House, we can all work together. I will try to ensure that what is in Mwongozo today infiltrates into the Bill to make it better. As I finish, I want to request the relevant Government bodies to give us support in these initiatives. What this House does is for the sake of this country and not in vain. This is done because we have seen a lacuna somewhere which needs to be filled. Every time we prepare private Members’ Bills, it is not to fight the systems but to make them better. I am happy with the hon. Member who said that this Bill is not just meant for public entities. This Bill is to build on corporate governance in this country, both in the private and public sectors. Hon. Temporary Deputy Speaker, I beg to reply. Thank you.

(Ms.) Mbalu): Hon. Members, for obvious reasons, I am not in a position to put the Question. I order that the Question be put at the next appropriate time.

Let us move on to the next Order. 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.

(Ms.) Mbalu): Hon. Members, Hon. Richard Tong’i had a balance of nine minutes. He can contribute if he is in the House and is ready. In the event he is not in the House, his time is forfeited. So, I will move to Hon. Yusuf Chanzu, the Member for Vihiga.

I had contributed on that Motion. I wanted to ---

(Ms.) Mbalu): Did you want to tell the House that you had contributed?

No, Hon. Temporary Deputy Speaker. It was ----

(Ms.) Mbalu): Okay. I thought there was something out of order. Hon. Member for Aldai, Cornelly Serem. Hon. Members, you have left your cards slotted in. Yes, the Member for Butula.

Thank you, Hon. Temporary Deputy Speaker for allowing me to contribute to this Motion on deployment of chaplains to learning institutions. I will start by thanking the Mover of the Motion, Hon. Odanga who is my good neighbour and a very good teacher in his own right. I acknowledge that at one time he was the principal of my village secondary school while I was the chairman of the board. I know that he has a very good reason as he comes from an appropriate background for recommending this kind of Motion. This Motion is very timely because it addresses the upbringing of our children in schools, particularly coming from very worrying observations related to drug abuse, drunkenness, promiscuity and many dangerous and irresponsible conducts. If we had well established structure with somebody who ensures that moral conduct, ethical standards and code in our schools is properly addressed and passed on to our children, it will help in the growth of our children. As we do this, we urge those in charge of these children, like teachers and other staff in the learning institutions that they too should be good examples to our children. 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.

Children observe a lot from their environment and how they see adults behaving. They copy a lot from that. Even as we put in place positions of chaplains, we also encourage adults in these institutions to set good examples and be role models to these children. Hon. Temporary Deputy Speaker, I also hope that if this Motion is passed and implemented, there will be a clear framework, standard or curriculum for chaplains so that this is not left at the discretion of every chaplain depending on their background and level of competence. There should be a very clear curriculum so that a chaplain also undergoes proper capacity-building. Even as this is put in place, we must keep insisting that the rights and freedoms of our children are be protected, be it freedom of belief, freedom of religion, freedom of association, and freedom of dressing. This is because there are religions that have rules about the kind of dressing that is needed. So, those freedoms must be protected. We also need to relook at our curriculum in schools. Many times, I feel, we have perhaps overburdened our children and we are not allowing them to be children. You will find very small children carrying huge bags on their backs going to school. Apparently, these bags contain books. It appears like we are overburdening our children with too much learning so that they are not able to grow up as children. Personally, as somebody who went through the A-level system of education, I still have nostalgia. When I see these students doing all these subjects in Form Four, I think they need a break of two years to concentrate on a certain field before they go to university. Maybe our education experts should look at this and do a cost-benefit analysis. Issues of radicalisation of our ---

(Ms.) Mbalu): You still have three minutes. I do not know what is wrong with your microphone. You can give him another microphone. Use the next one.

I think the other one is tired, Hon. Temporary Deputy Speaker. I was wondering because I had just mentioned radicalisation of our children before it went off. This is a matter of concern. Maybe this matter can also be addressed perhaps with good guidance from a well-trained or professional chaplain. Finally, I think that one of the areas that need to be addressed seriously for our children and youth is unemployment. This is really a time bomb. The rate of unemployment in our country, particularly for school leavers both at Form Four and university level is alarming. We need to address this matter seriously. I am aware that not everybody can get office job or employment, but we need to ensure that our youth are profitably and gainfully occupied, otherwise we are sitting on a time bomb. Hon. Temporary Deputy Speaker, I support the Motion. I also thank you for giving me the opportunity.

(Hon. (Ms.) Mbalu): Let us now hear the nominated Member, Hon. Patrick Wangamati.

Thank you, Hon. Temporary Deputy Speaker, for giving me this opportunity. First, I want to congratulate the Mover because I know he has been a very successful teacher. He has brought this Motion to this House after a lot of consideration. The 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.

way I look at things, given my age, is that the country is headed to a situation where we have to talk to our children. The country’s progress will be based on that. It is important that we have chaplains in school so that they can talk to our children. Parents have proved that they are unable to talk to their children. They do not even share the word of God. This is important because we banned caning in schools. Watoto wanafanya makosaambayo yako obvious kwa community na hata kanisani, lakini hatuwachapi viboko . Mimininaona we have to go that way---

(Hon. (Ms.) Mbalu): Order, Hon. Patrick Wangamati! Our Standing Orders are clear that a member should only use one language when debating. That is either Kiswahili or English.

Let me speak English, Hon. Temporary Deputy Speaker. Most of our parents in this country have given up on talking to their children even when the children make obvious mistakes. So, we need to introduce counselling in our schools, as Mheshimiwa has said. In their early stages of formation, we need to expose them to chaplains so that they can know what is wrong and what is right. Children need to learn a lot about respect and the word of God. I support this Motion because I would like us to make many changes in our country’s system of education. We have shown that we are not able to discipline our children by caning them. So, let us go the way the Motion is proposing. Hon. Temporary Deputy Speaker, it is important that the Government develops a curriculum to implement the proposal of having a chaplain in every school. I support this Motion. Thank you.

(Hon. (Ms.) Mbalu): Thank you, Hon. Member. I love the passion that you have shown in supporting the Motion. Next on my request list is the County Women Representative for Migori, Hon. Ghati.

Thank you very much, Hon. Temporary Deputy Speaker for the opportunity to contribute. I wish to support the Motion about deploying chaplains to learning institutions. Personally, I grew up in a very strict Catholic environment both at home and school. I happened to be in a boarding school from Standard Three. We had good character instilled in us from a very early age. This is a very timely Motion because you can see what is happening in our country. Our young people and more so students in schools are becoming unruly. Good character should be instilled in them. As parents, we have become too busy for our children. We are increasingly leaving our responsibility as parents to teachers, the media, house girls or anybody who can listen to our children. We have a problem as parents because we have left our responsibilities of raising our children to third parties. That is why it is important that we have such mechanisms in place. Chaplains play a big role in instilling good behaviour and good character in our children, which we have absconded as parents. We are too busy chasing careers and other things and so we do not have time for our children. Kenyan parents do not even sit down with their children to talk about issues such as reproductive health. Parents do not talk about sexuality with their children; they do not talk about many things. We leave other people to mould our children and yet we keep complaining. This Motion, therefore, is coming at the right time. Look at what is happening in this country. There is burning of schools everywhere. Every day we wake up to news that schools are 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.

being burnt right, left and centre. Our children need such people who can talk to them, advise them and inspire them. Right now, children are going into exams, but they are afraid of exams. What happened to guidance and counselling sessions? We used to have guidance and counselling sessions when we were growing up. They are no longer there or they are not being taken seriously. We need to re-introduce serious guidance and counselling sessions in our curriculum. This was there during our time in school. We used to have sessions with elderly teachers who would give us guidance. As parents, even as we think about having chaplains in secondary schools and institutions of higher learning, we need to play our roles. We are supposed to take seriously our responsibilities as parents. Just look at our children when they are going to school in the morning. They are overburdened. Our children wake up at 4.00 a.m. and by 6.00 a.m. they are in buses going to school. I am talking about six-year old kids. This is not how it used to be. Hon. Temporary Deputy Speaker, getting education in this country has become very expensive. Our children wake up very early when they still want to sleep. They have many issues to grapple with. That is why, to me, having chaplains may be a short-term answer but we need to seriously look at the role that we play as parents in terms of shaping the character of our children. Chaplains will instill positive attitude and godliness in our children. They will also teach them how to live, but the biggest responsibility still lies with the Kenyan parent. We must look after our children. This is a good Motion and that is why I support it.

(Hon. (Ms.) Mbalu): Hon. Kedogo, the County Women Representative for Vihiga, you have the Floor.

Thank you, Hon. Temporary Deputy Speaker. I thank Hon. Odanga for bringing this Motion before this House. It is timely because we have seen schools being burnt by students. We have also seen students who are not disciplined. If students in our schools are not disciplined, then they will not engage in meaningful activities that will build Kenya. There is Programme for Pastoral Instruction (PPI) in primary schools where chaplains go to schools to talk to pupils. They only take 10 minutes to talk to the students and this arrangement has not had any impact. Hon. Temporary Deputy Speaker, this Motion should be expanded to include lessons where students are taught good values either once or twice a week. We have an increase in drug abuse in our schools. Teachers have tried to change these students but they have failed. Chaplains should be sent to schools to reduce crime in our schools. Previously, there were lessons on social education and ethics. Parents and the community at large no longer have values. The famous “my dress, my choice” clarion call is bringing harm to our students. Students are now misbehaving because no one will punish them. Age difference in schools is also another problem. Because of the free primary school education, we now have young and old students attending the same classes. This is because younger students acquire behavioural traits from older students. Chaplains should be sent to schools to inculcate good values in our children. We have guidance and counselling in schools, but why are students still taking drugs? Why are students burning schools? This is because teachers are not given an opportunity to interact with students. Some students even report teachers to their parents, who quarrel teachers who try to counsel students. Teachers have now decided to just sit back and watch. 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.

Hon. Temporary Deputy Speaker, parents are also a concern. They need to instill values in their children. Some parents cannot even guide their children because they fear them. Teachers also fear big boys because they can fight them. Chaplains should be deployed to schools so that we can have order in our schools. Thank you, Hon. Temporary Deputy Speaker.

(Hon. (Ms.) Mbalu): The County Women Representative for West Pokot, you have the Floor.

Thank you very much, Hon. Temporary Deputy Speaker. First, I congratulate Hon. Odanga for bringing this timely Motion to this august House.

Chaplains are trained people who have the word of God in their hearts. Having the background of a teacher and having learnt the psychology of children, I know that from conception to the age of going to school, a child learns something from the parents. If this continues in school, where we have chaplains, it will make a child a whole person.

Chaplains have to be trained and qualified people so that they can handle children at different stages, especially in primary and secondary schools. Children have to be taught the word of God and social life lessons as they grow up. It is really important for us, as a country and as a nation, to bring up our children in the right way. Hon. Temporary Deputy Speaker, these days you can bear me witness that most of our children get spoiled mainly in schools. The character of a child can be good at home but immediately he or she joins secondary school or an institution of higher learning, you see him or her changing and adopting a negative behaviour. That means we have left our children in secondary schools or institutions of higher learning unattended. I propose that chaplains be employed. However, they should be qualified so that they can handle children of different ages in different institutions. We may have heard about chaplains giving lessons to children in primary schools and yet they do not handle the children the way they are supposed to. I propose that chaplains must meet certain qualifications. They must be trained in psychology in order for them to handle our children well. Hon. Temporary Deputy Speaker, I support this Motion.

(Hon. (Ms.) Mbalu): The Member for Kapenguria, Hon. Samuel Moroto, you can make your contribution.

Thank you very much, Hon. Temporary Deputy Speaker for also giving me this chance to add my voice on this very important issue of chaplains. My colleagues have touched a lot on the issue of chaplains. When we talk about chaplains, we are not only concentrating on children but also adults like teachers, people who are working within institutions and even the neighbouring community. During prayers, these people can go and learn the word of God. Hon. Temporary Deputy Speaker, you have seen schools that are doing well like Moi High School Kabarak, Precious Blood, Alliance and Starehe Boys’ Centre. You have not heard students from these schools misbehave. The reason is that they have strong belief and faith that they follow in their teaching. We are not putting a lot of effort in other schools to ensure that spiritual growth goes hand in hand with academic growth. Misbehaving and indiscipline sets in because students are left without any care. Chaplaincy is very strong even in military institutions. Hon. Temporary Deputy Speaker, I want to thank staff of Citizen Television because on Sundays they always visit schools and other institutions such as the military. You should see the way people behave before the cameras; they are very good. If we implement that here, we will definitely experience many changes in the way we behave and handle things in this country. We 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.

always talk, but putting it into practice is a different thing altogether. Look at how we conduct ourselves in this House. We are here as Members because we were elected by people, but we do not respect and honour the institutions that are created by the Constitution. I had a rough time today at Parliament gate. The police who are supposed to be in charge of our security are no longer in charge. There are people at the gate who I do not know how they got there. Those people can say what they want. My vehicle was smashed and when I went to Committee Room No.7 to raise the issue, I was told that, that was “fire” and they could do nothing about it. I was told it was only the Clerk or the Speaker who could deal with the matter. Who is this who is above the law? We talk about morality, but if we cannot exercise it in this House, are we sure that the same will be exercised out there? We need to speak the truth. We begin our sessions with prayers all the time in this House. It looks like what we do here is just a by the way because it is a practice which we must follow. We do not observe it the way it is supposed to be. I congratulate whoever brought the issue of chaplaincy here. We can pass the law because we are legislators, but who will implement it? I am afraid that the people concerned with the implementation are rotten and cannot perform. If I was told that the security people at the gate are untouchable, how are the police officers going to work? I am told the security people at the gate are paid more than our security who are rightly paid from taxpayers’ money. These officers are trained and they know how to conduct themselves. We need to be serious as leaders of this country. If we behave this way that is how our children will behave because they see what we are doing. I grew up in a family where both parents used to take busaa . Most of the time they would quarrel and we would also quarrel. It is only when we went to the church with them--- They belonged to Dini ya Musambwa and they did very well. In that cult, quarrelling and drinking of alcohol is not allowed. So, that changed their life and that is why I am here speaking to you. I always respect God and the law that has been put in place. Hon. Temporary Deputy Speaker, I support this Motion, but let us begin to correct ourselves from this House so that we can be effective out there. I will deal with the other issues I have talked about later on. Thank you.

Let us have Hon. Alice Chae, the County Women Representative for Nyamira.

Thank you, Hon. Temporary Deputy Speaker for the opportunity to also add my voice to this Bill which has come at the right time. I am supposed to congratulate the Hon. Odanga, for what he has done. We have been seeing very many bad things happen to the community, parents and schools in the country. Deployment of chaplains to schools is important. This should have been done yesterday so that the wellbeing of students is taken care of. Students are not only in school to gain book knowledge but also other skills so that they become all round. They should have virtues, values and beliefs in order to integrate into the community they will serve in future. A chaplain is a person who will be in touch with students, the school community and teachers. This is because he or she has to make sure that a school becomes a community or a family that understands each other, coordinates and works towards a goal that it wants to achieve in future. A chaplain will provide spiritual guidance and inculcate values in a school. I hope that as we are debating to pass this Motion, principals or head teachers of these schools will create time 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.

for chaplains to interact and mingle with students. You understand the competition among schools that has led to schools wanting students to read from morning until evening. Even going for games is unheard of. Hon. Temporary Deputy Speaker, there should be time for chaplains to interact with students so that they can know what they are going through. It is actually a chaplain who can pass information to the teaching fraternity on what students need. There are students who could be in need of something but it is very hard for teachers to know this. However, for a chaplain whose duty and responsibility is to ensure that the wellbeing of students is catered for, he or she will deliver that message in the right way. After that ways of solving the problems would be found. I think a conducive environment ought to be created in order for chaplains to work well. Hon. Temporary Deputy Speaker, another thing I am worried about is the different faiths in schools. I hope you know that a student selects a school not because of the religion he or she prescribes to. A student is admitted to a school to learn and achieve what he or she wants in future. So, a chaplain should not be extreme. There should be moderation so that they bring out the values we are talking about so that there is harmony and understanding in schools. So, we need chaplains who will respect and be sensitive to other people’s views, values and beliefs. If this is maintained, there will be order, understanding and good environment for students to learn and teachers to do their work.

The qualifications referred to in the Motion are good and if we go as per what the Motion says, we will go somewhere. Hon. Temporary Deputy Speaker, I support the Motion. Thank you.

(Hon. (Ms.) Mbalu): Hon. Members, the Mover will be called upon to reply at 12.55 p.m. We had a balance of 53 minutes. I now give five minutes to Hon. Wesley Korir.

Thank you, Hon. Temporary Deputy Speaker. I will be as quick as possible so that another Member can get an opportunity too. The Motion is well represented. It captures the challenges that we are facing in this country. Our kids are not growing into people we want them to be because they are aping modern culture. We see a lot of immorality, schools burning and many other things that we do not want our kids to go through. As a House, it is our responsibility to make laws and advise the Government on better ways to solve the challenges that the country is facing. As much as I support this Motion, I want to ask myself a question. In every school---

(Hon. (Ms.) Mbalu): Hon. Alice Chae and Hon. Dawood, the Member for North Imenti you are shouting in the House. It is unprocedural and a sign of lack of decorum. Carry on Hon. Korir.

Hon. Temporary Deputy Speaker, as much as we want the Government to do the job of deploying the chaplains, I wonder what will be the work of the churches that are sponsors of these schools. Most schools have the saint name and are either sponsored by Catholic Church, African Inland Church (AIC), Pentecostal Assemblies of God (PAG) or any other religious organisations. That should be the responsibility of those churches. Once you have shown interest as a church to sponsor certain schools, there will be no financial contribution you 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.

will make. Most of those churches do not make any financial contribution. Most of these schools are built by the National Government Constituencies Development Fund (NG-CDF). It is not appropriate for us now to ask the Government to deploy chaplains. This should be the responsibility of the churches that sponsor schools.

(Hon. (Ms.) Mbalu): The Member for North Imenti, you are out of order!

Throw him out!

I apologise, Hon. Temporary Deputy Speaker.

Hon. Temporary Deputy Speaker, they are finishing my time and yet I want to---

(Hon. (Ms.) Mbalu): Hon. Dawood, you are out of order! Next minute, I will throw you out of the Chamber.

Hon. Temporary Deputy Speaker, since these churches have board representatives, we should urge them to finance and pay for the chaplains who will take care of children in our schools. When I was a child, there was a programme that helped me a lot. It was the PPI that was conducted every Friday in the morning. I remember it was during this time that I gave my life to Jesus Christ and got saved. I was not a good kid, but that programme changed my life. So, we should encourage these programmes to be conducted in schools. The education coordinators should ensure that these programmes are available to our children so that they are spiritually nourished by the chaplains. Those are the most important things. Hon. Temporary Deputy Speaker, I echo what other Members have said. Our education system has become burdensome to our kids. Our children are going to school at a very young age. By the time they get to Standard Eight or Form Three, they are tired of education because we burdened them when they were too young. We need to look deeply into our education system so that children do not get tired of education instead of enjoying it.

(Hon. (Ms.) Mbalu): You are just on time. It is exactly 12.55 pm. I, therefore, call upon the Mover, Hon. Geoffrey Odanga, to reply.

Hon. Temporary Deputy Speaker, I would like to donate a minute each to Hon. Janet; the Member for North Imenti, Hon. Dawood and Hon. (Dr.) Christine. I will use the remaining three minutes to reply.

(Hon. (Ms.) Mbalu): You will have two minutes remaining. Hon. Janet Teiya, you have a minute.

Thank you, Hon. Temporary Deputy Speaker for giving me this opportunity. I would also like to thank Hon. Odanga for donating a minute to me. I support this Motion because chaplains are very important in our schools. This is because apart from our children getting the normal education, they will also get an opportunity to grow spiritually and be trained in all aspects of life. Our children need to know their responsibilities. They need to love and take care of each other. Currently, there are very many things happening in our schools. Our children need to know what is good and what is bad. With the help of chaplains, they will get knowledge on how 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.

to handle their peer groups and drug abuse menace. They will also learn how to differentiate between bad from good. They further know more about terrorism.

(Hon. (Ms.) Mbalu): Let us now have the Member for North Imenti.

Thank you, Hon. Temporary Deputy Speaker. First of all, let me thank Hon. Odanga, the sponsor of the “Kaimenyi Motion”. He is a good friend. I appreciate what happened last year but we managed. I support the Motion because it is timely. We need to inculcate religious values in our school-going children. I even request Hon. Odanga to see if we can also include Imams because schools have lost the moral fabric. Today, students burn schools. That never happened previously. We need to check on radicalization in our schools. What Hon. Odanga has proposed is very good. The Motion should read “resolved” and not “urge” because we need our children to grow up into responsible adults.

(Hon. (Ms.) Mbalu): Your minute is over. Hon. Christine Ombaka, you were given a minute by Hon. Odanga. However, you cannot speak because you spoke on this Motion on 3rd August, 2016. You contributed and had a balance of nine minutes. However, you did not show up to use the remainder of your time when debate on this Motion resumed on 10th August, 2016. Hence the remainder of your time was deemed to have been forfeited. You cannot speak twice on the same debate. Therefore, I call upon the Mover to reply. You can use your two minutes, Hon. Odanga.

Hon. Temporary Deputy Speaker, I take this opportunity to thank the Members who have contributed to this Motion. The contributions have been immense and overwhelming. Chaplains will continue to play a big role in schools. We have teachers who teach many subjects and others who offer guidance and counselling services. However, they cannot offer these services adequately because they have other subjects to teach. Some schools have large classes of between 70 and 100 students. Thus they cannot offer any meaningful advice to children. The chaplains are not just for the students, they will also guide teachers, members of the communities as well as parents. In some cases, teachers and parents need to be guided on how to interact with students as they bring them up. Therefore, chaplains are very important. Chaplains will come from all religions so that even in a Catholic-sponsored school, religious leaders who are qualified and well trained, be they from the Muslim or Hindu faiths, can be deployed by the TSC to offer such services to our children while in school. With those remarks, I beg to reply.

(Hon. (Ms.) Mbalu): Hon. Members, for obvious reasons, I will not put the Question on this debate. I, therefore, direct that the Question be put at the most appropriate time as shall be determined by the House Business Committee.

(Hon. (Ms.) Mbalu): Hon. Members, the time being 1.00 pm, the House stands adjourned until this afternoon at 2.30 p.m.

The House rose at 1.00 p.m. 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.