He was a super Cabinet Secretary controlling a huge chunk of the national budget and his vice-like grip on key infrastructure projects propelled him to be one of the most powerful men in Uhuru Kenyatta’s government.
However, a presidential executive order issued last Friday has stripped him bare after taking powerful roles from the Ministry of Transport, Infrastructure, and Housing, subsequently removing control of billions of shillings allocated to it.
The ministry under CS James Macharia has been receiving significant funding, more than a third of the national development budget since 2015.
Apart from Interior CS Fred Matiang’i who wields immense powers in the security circles, Macharia oversees the four “most lucrative” dockets in terms of funding in government namely: Roads, Rail, Port, and Housing.
However, following the new order, he has been left with roads and housing docket to handle and questions have been raised as to what has inspired the President to take such powers from him.
Macharia was transferred to the transport and infrastructure ministry on 24 November 2015, moving from the health docket. When he took office, the ministry was composed of two departments, transport and infrastructure.
In this year’s budget, the ministry was allocated over Sh300 billion with the transport sector getting an allocation of Sh172 billion for construction and rehabilitation of road networks, Sh18.1 billion for the second phase of the Standard Gauge Railway (SGR) project, Sh6 billion for the LAPSSET project, Sh5 billion for the Mombasa Port and Sh328 million for insurance services to the ferry services on the Likoni Channel.
The Housing, Urban Development and Public Works has been allocated Sh15.5 billion in the Kenya Budget 2020/21.
In May 2016, President Uhuru Kenyatta through executive orders added three more: the departments of public works; housing and urban development, and shipping and maritime affairs.
Framework for management
On Friday, the President issued an executive order that established a framework for the management, coordination and integration of the public port, railway and pipeline services under the Kenya Transport and Logistics Network (KTLN).
The network comprises the Kenya Ports Authority (KPA), Kenya Railways Corporation (KRC), and Kenya Pipeline Company Limited (KPC).
State House spokesperson Kanze Dena stated that the framework would be under the coordination of the Industrial and Commercial Development Corporation (ICDC).
ICDC will act as the holding company to the three agencies as well as be responsible for the management of the state’s investments in ports, rail, and pipeline services. The company will be headed by John Ngumi, who is the KPC board chairman.
“Going forward, the state agencies are required to enter into a joint operations agreement within 30 days that will reorganize individual entity structures, resources, operations, and services.
“The reorganization will help to establish a seamless and coordinated national transport and logistics network,” reads the statement by Dena.
Former Mandera Central MP Abdikadir Mohammed who chaired Uhuru’s 2013 task force on parastatal reforms described the consolidation as a “ step in the right direction.”
“The move is in line with our task force recommendations. It makes sense to have all transport entities in the transport sector under one roof,” he told People Daily yesterday.
Abdikadir who once served as the Uhuru’s adviser on constitutional affairs also defended the decision as lawful.
“The president has lawful authority to re-organize his Executive. The State Corporations Act gives the President powers to make changes in parastatals.
The major challenge now will be governance especially corruption because the amendments we had proposed to accommodate the parastatal reforms have nor been passed,” he said.
The lawyer cited the case of South Africa, where agencies in the transport sector are run by an umbrella body, called Transcend.
Commenting on the changes, Kikuyu MP Kimani Ichung’wa, said the reorganization within government ministries can be done to move one agency or function from one ministry to the other, but this must be informed by the need to improve efficiency in operations and use of resources to deliver services.
“The state corporations are by statute supposed to operate in an autonomous manner independent from the Ministries with the ministry playing an oversight/Supervisory role.
Therefore, you must also consider the ministries that have the expertise and human resource to supervise the operations of state corporations that will fall under them” said Ichung’wa.
However, Ichung’wa who served as the Budget and Appropriation Committee chairman before he was axed recently, noted that the more pertinent question that arises is whether it is possible to centralize the three corporations without amending the parent Acts establishing the state corporations these being the Energy Act, 2019, the Kenya Ports Authority Act, Cap 391, the Kenya Railways Corporation Cap.397 and the State Corporations Act, Cap 446.
“Further, what the Executive Order has done is to create a new amorphous body in the name of KTLN with no proper structures by purporting to bring the three-state corporations together under one umbrella which only serves to create inefficiency and bureaucracies,” he said.
Transport Committee chairman in the National Assembly David Pkosing defended the President’s move saying constitutionally, he has the powers to transfer a department to another.
“It is within the powers of the President as provided for by the Constitution to reorganize his government in a way that the changes will be more productive than they were,” said Pkosing.
Asked whether he felt Macharia was losing clout and power after the changes, Pkosing said, “This will be for Kenyans to decide.”
He added that the move taken by the President was the right one as it will help state agencies to leverage themselves to positive gains like accessing huge funding in the process to improve their profits.
The Pokot South MP however said that the changes do not in any way interfere with the work of his committee, saying that whereas the new board will deal with the budget aspect, the committee will handle the legal framework.
Makueni MP Dan Maanzo said that Macharia was already overloaded as the docket he is handling is “too wide.”
Welcoming the move by the President, Maanzo said the changes have come at the right time as they will help change the fortunes at the three state agencies which have faced mismanagement over the years.
“By transferring the powers to manage the three agencies to the National Treasury is a good move since it will be now possible to manage their finances and ease management,” said Maanzo.
Lawyer Bobi Mkangi said parastatals are statutory entities created by an Act of parliament and therefore the President should have sought an amendment to the existing law to effect the changes.
“Again, we should interrogate the economic advantage of the new entity that has been created by the President,” Mkangi said.
Macharia’s reign has however been shrouded in controversies ranging from mismanagement, graft, and skewed award of tenders.