Tough week for Kagwe as MPs demand lease documents, tender records in sugar mill probe
The legislators have expressed serious concerns over transparency and demand a full account of the leasing process to ensure that the interests of farmers, workers and local communities are safeguarded.
Lease agreements, tender packages, bidders’ financial statements, public participation records and legal opinions are among the critical documents Members of Parliament want Agriculture Cabinet Secretary Mutahi Kagwe to produce as evidence that sugar mill leases were conducted fairly.
The legislators have expressed serious concerns over transparency and demand a full account of the leasing process to ensure that the interests of farmers, workers and local communities are safeguarded.
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Under the leasing arrangement, four public sugar millers have been allocated to different private firms: Nzoia Sugar will be managed by West Kenya Sugar Company; Chemelil Sugar by Kibos Sugar and Allied Industries; Sony Sugar by Busia Sugar Industry Ltd; and Muhoroni Sugar by West Valley Sugar Company.
Kagwe is scheduled to appear before the National Assembly's Agriculture Committee next week to respond to at least ten questions raised by legislators, particularly Muhoroni MP James K’Oyoo and Suba South MP Caroli Omondi, regarding the government’s plan to lease struggling state-owned sugar factories to private investors.
On Thursday, the National Assembly rejected an initial written response from the CS that had been submitted through the committee.
Speaker Moses Wetang’ula directed Kagwe to appear in person before the House, following a strong push by MPs who argued that the response did not address key concerns.
“I find the response grossly insufficient. We were given the impression that the purpose of leasing out these industries is for them to work better for the citizenry,” MP James K’Oyoo said.
K’Oyoo said his priority was to see how the lease benefits the farmers, factory workers and the surrounding communities, many of whom gave up their land for the factories to be established.
“We will need to have the CS here so that he gives a blow-by-blow account of the process. While the intention was good, the process was flawed. This is where we need more clarification,” he added.
He also questioned how one of the companies, which he claimed is facing several court cases, ended up benefiting from the process, despite an earlier agreement that no firm with active litigation should qualify.
MPs are now demanding that Kagwe table all transactional documents, including the full tender package, advertisements, bidder evaluations, and records of how the winning firms were selected. They also want him to provide the individual lease agreements for each sugar mill.
The House is seeking access to the investment plans submitted by each successful bidder, the performance guarantees provided, including those from banks, and official confirmation that none of the firms will use the nucleus estates of the leased mills as collateral for borrowing.
In addition, Parliament wants the Cabinet Secretary to submit audited financial statements for each of the preferred bidders covering the last seven years. Legislators also expect to receive signed declarations from the firms, disclosing the identities of their beneficial owners, amid concerns that politically connected individuals could be behind the companies awarded the leases.
MPs further insist on documentation proving that proper public participation took place. This includes minutes from meetings, letters of reference from banks, and endorsements from stakeholders within the sugar industry.
Kagwe is also required to present a legal opinion from the Attorney General’s office validating the selection of the winning bids, as well as the position of the Competition Authority on the process.
While the leasing has sparked questions in Parliament, President William Ruto has defended the initiative. Speaking on Thursday during a meeting with Siaya County leaders at State House, Nairobi, Ruto credited the “broad-based government” for making the lease possible, citing previous failed attempts.
“Some of the decisions we are making are difficult. For instance, we would not have managed to lease out our sugar mills, something we have been trying since I was the Minister for Agriculture in 2009, but it became possible because of a broad-based government,” he said.
He added that efforts had been made to get opposition leader Raila Odinga to oppose the leasing deal, but these attempts were rebuffed.
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