A lobby has filed a case at the High Court seeking a stop to the planned privatisation of public parastatals. Civil Society Reference Group (CSRG), a coalition of over 200 Human Rights, Social Justice and Public Benefit Organisations are against the Cabinet and the Privatization Authority plans to go ahead with such a plan before carrying out proper public participation to seek the consent of the governed.

They moved to court last week and filed a suit under certificate of urgency challenging the legality of a spate of privatisation of some public parastatals currently underway. Through lawyer Kevin Oriri, the Civil Society Reference Group, argued that the reported planned auction of the state firms and/or any transaction was null and void by law. It cited its arguments that the privatisation purports to arise from a defunct Gazette Notice backing to August 14, 2009 and that it proceeds as per the requirements of the repealed law.

CSRG, claimed a new Privatisation law needs to be established for there to be a legal basis for any such transaction post the date of the enactment of the Privatisation Act, 2023 to go on. This Act, which was passed into law on October 9, 2023, and commenced on October 27, the same year, is responsible for repealing the said Gazette Notice. The legal petition came months after President William Ruto’s administration signed a revised privatisation bill into law that makes it easier to sell some State enterprises to private companies.

The revised law aims to push up the private sector’s participation in the economy, and to revitalise and commercialise some of the non-performing State corporation’s or parastatals.

Material breach

But the group reiterated that the process is illegal and amounts to a material breach of procedure, having not gone through parliamentary ratification. This also includes lack of stakeholder engagement and public participation contrary to sections 21,22 and 23 of the Privatisation Act, 2023.

So, it urged, Milimani High Court to issue orders quashing the decision of the Cabinet contained in the dispatch dated February 14, 2024, authorizing the privatisation of some public entities.

The affected entities are Development Bank of Kenya (DBK), Kenya Safari Lodges and Hotels Limited, (incorporating Mombasa Beach Hotel, Ngulia Safari Lodge, and Voi Safari Lodge). Others are Golf Hotel Limited, Sunset Hotel Limited, in Kisumu, Mt Elgon Lodge Limited and Kabarnet Hotel Limited.