State House says no jobs will be lost after merger of 42 state corporations
The mergers are part of broader efforts to create a leaner, more effective public service system.
The government has assured citizens that no jobs will be lost following the recent Cabinet decision to merge 42 state-owned enterprises into 20 parastatals.
The move, aimed at cutting costs and improving efficiency, has sparked concerns about potential layoffs among affected employees.
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State House Spokesman Hussein Mohammed on Wednesday refuted claims that jobs will be lost.
"No state corporation function will be lost, and no jobs will be lost as all affected employees will be absorbed into the public service," he said.
Hussein noted that the reforms are designed to streamline government operations, reduce waste, and curb excesses without compromising workers' livelihoods.
He added that the restructuring will tackle operational and financial inefficiencies while enhancing service delivery and reducing the financial burden on the exchequer.
The mergers are part of broader efforts to create a leaner, more effective public service system.
Following a Cabinet meeting at the Kakamega State Lodge on Tuesday, the government announced plans to merge over 40 state corporations into nearly half the number.
Assessment
This decision follows an assessment by the Ministry of Treasury, led by Cabinet Secretary John Mbadi, which reviewed 271 state corporations.
State corporations that were previously identified for privatisation will not be part of this merger.
The University Fund and the Higher Education Loans Board (HELB) will merge into one body, as will the Kenya Tourism Board and the Tourism Research Institute.
The Anti-Counterfeit Authority, Kenya Industrial Property Institute, and Kenya Copyright Board will also be combined into a single parastatal. Similarly, the Kenya Forest Service and Kenya Water Towers Agency will merge.
As a result, nine state corporations will be dissolved, and their duties will be transferred to relevant ministries or other state bodies.
Additionally, 16 corporations with outdated mandates will be privatised or dissolved.
Among the nine to be dissolved are the President's Award, Kenya Nuclear Power and Energy Agency, Kenya National Commission for UNESCO, and the Kenya Film Classification Board.
The government also announced that six state corporations will undergo restructuring to improve their performance and align their mandates.
These include the Kenya Roads Board, National Housing Corporation, Postal Corporation of Kenya, and Kenya Utalii College.
Four public funds currently listed as state corporations will be removed from that classification and returned to their respective ministries under a new governance structure.
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