Govt Addresses Job Losses Fears Ahead of State Corporation Sale

The government has addressed the fate of Kenya Pipeline Company (KPC) employees after the Cabinet approved its privatization.

Nakuru Town East Member of Parliament David Gikaria and his Balambala counterpart Abdi Shurie, who co-chair the Joint Committee on Energy and the Committee on Public Debt and Privatization, raised concerns over the fate of KPC employees amid fears that the privatization could trigger restructuring and possible job losses.

However, Energy and Petroleum Cabinet Secretary (CS) Opiyo Wandayi assured legislators that employee welfare is protected under existing legal frameworks.

Wandayi said there will be no interference with the job structures, and none of the staff will be laid off.

“We do not foresee any job losses or any restructuring to the current job structures at KPC,” Wandayi said.

However, Gem MP Elisha Odhiambo challenged his remarks, claiming that many KPC staff are anxious about the proposed changes but are hesitant to voice their concerns for fear of victimization.

Most KPC employees are afraid to speak openly, but the true position is that they are distressed by the proposal.

The Committee also raised concerns about the government’s proposal to privatize KPC despite the state-owned entity recording steady growth in profits over the years.

Under the plan, the National Treasury intends to retain a 35% stake in KPC while offering 65% of the shares to the public through the Nairobi Securities Exchange.

However, members of the National Assembly’s Energy Committee have expressed doubts over how the government reached the decision to sell a majority stake in the strategic company and a critical National Asset.

The lawmakers have accused the Treasury of running an opaque process, noting that the committee is yet to receive the company’s valuation report.

They insisted that a comprehensive valuation of KPC and its assets should be made public to establish the true value of the company.

“You cannot sell something that you do not even know its value,” Wajir East Aden Daudi said.

The committee is expected to engage Treasury for the second time on August 13, together with the office of the Attorney General, before making its final recommendations on the privatisation plan.

Also Read: Ruto’s Cabinet Approves Sale of Kenya Pipeline Company

Cabinet Approves Kenya Pipeline Company Privatization

The Cabinet approved the privatisation plan after a meeting on July 29, 2025.

In the dispatch, the Cabinet said the decision reflects the government’s policy shift toward reducing its role in doing business and instead enabling the private sector and industry experts to drive growth, efficiency, and innovation.

It noted that KPC is a strategic player in Kenya’s energy supply chain, which has maintained a strong profitability record and holds significant asset value.

However, the Cabinet noted that the company has not yet reached its optimum performance and market value, largely due to bureaucratic constraints and public sector inefficiencies.

Bringing in private capital and professional expertise is expected to inject new energy into the company, modernise operations, and position KPC as a regional logistics and energy powerhouse.

Also Read: Court Orders Kenya Pipeline and NEMA to Pay Ksh3B for Oil Spill Damages

Govt  Parastatals Privatized in the Past

The Cabinet stated that similar moves have yielded transformative results in the past.

It highlighted Safaricom, Kenya Commercial Bank, and KenGen as prime examples of formerly State-controlled entities that became high-performing companies following privatisation, driving shareholder value, expanding regionally, and creating thousands of jobs.

Cabinet explained that the divestiture of KPC will follow the same path, boosting investor confidence and supporting the development of Kenya’s capital markets.

The approval marks a shift from State dominance in commercial enterprises to a model that embraces private sector-led growth, operational discipline, and accountability, ultimately ensuring that public resources are better used to deliver essential services.

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