The Cabinet has proposed the dissolution of 16 state corporations deemed to have outdated mandates or whose functions can be effectively handled by the private sector. The decision was made during the first Cabinet meeting of 2025, chaired by President William Ruto at the State Lodge in Kakamega.
In a move aimed at addressing inefficiencies, reducing reliance on public funds, and enhancing service delivery, the Cabinet approved a series of reforms to state corporations. President Ruto emphasized the need to seize the transformative opportunities presented by the Bottom-Up Economic Transformation Agenda to drive meaningful change across the country.
Corporations to Be Dissolved
Among the 16 corporations set for dissolution are:
1. Numerical Machining Complex
2. Scrap Metal Council
3. Kenya Fishing Industries Corporation
4. Jomo Kenyatta Foundation
5. Pyrethrum Processing Company of Kenya Ltd
6. Kenya National Shipping Line
7. School Equipment Production Unit
8. Kenya Yearbook Editorial Board
9. Kenya National Assurance Company
10. Coast Development Authority
11. Ewaso Ng’iro South Development Authority
12. Ewaso Ng’iro North Development Authority
13. Kerio Valley Development Authority
14. Lake Basin Development Authority
15. Tana and Athi Rivers Development Authority
These corporations have been deemed redundant, with their roles either outdated or better performed by the private sector or other government entities.
Additional Reforms
The Cabinet also approved the dissolution of nine other state corporations, transferring their functions to parent ministries or relevant agencies. These include:
Kenya Tsetse Fly and Trypanosomiasis Eradication Council
Kenya Fish Marketing Authority
Centre for Mathematics, Science and Technology Education in Africa
President’s Award – Kenya
Nuclear Power and Energy Agency
Kenya National Commission for UNESCO
Kenya Film Classification Board
National Council for Nomadic Education
LAPSSET Corridor Development Authorit
The reforms also include merging 42 state corporations with overlapping mandates into 20 entities to eliminate redundancy and improve operational efficiency. Additionally, six corporations will undergo restructuring to better align their functions with national priorities.
Fiscal Challenges Drive Reforms
These measures come against a backdrop of increasing fiscal pressures, with public debt burdens and a growing demand for high-quality public services. As of March 31, 2024, state corporations had accumulated pending bills amounting to KSh 94.4 billion.
The Cabinet highlighted the need to declassify four public funds currently operating as state corporations. These funds will be returned to their parent ministries under a strengthened governance framework. They include:
Water Sector Trust Fund
National Environment Trust Fund
Sports, Arts, and Social Development Fund
Fish Levy Trust Fund
President Ruto’s Commitment
President Ruto reaffirmed his administration’s commitment to streamlining government operations, reducing waste, and ensuring efficient service delivery. He noted that the reforms will position the government to achieve its economic transformation agenda and improve the livelihoods of Kenyans.
The Cabinet’s decisions mark a bold step towards reforming state corporations and addressing inefficiencies that have long hindered economic progress. The proposed measures now await implementation to streamline operations and reduce the financial strain on taxpayers.
