Government Seeks New Law to Revive Ailing Cooperative Societies

The Ministry of Cooperatives and Small Businesses is working on a new law to address governance and management issues within cooperative societies across the country. According to Cabinet Secretary Wyckliffe Oparanya, a bill seeking to reform the sector is currently before the Senate.  

Speaking in Mombasa during a meeting with the Senate Committee on Trade, Industry, and Tourism, CS Oparanya attributed the collapse of many cooperative societies to poor leadership and corruption. He emphasized that if passed, the law would provide a framework to enhance accountability and efficiency in cooperative management.  

"The existing law governing cooperatives, which was enacted in 2008, is outdated and does not effectively address the challenges facing businesses today. We are working on amendments to ensure cooperatives are well-managed and can thrive," said Oparanya.  

In addition to cooperative reforms, the CS encouraged tea farmers to diversify into coffee farming, citing a growing market for coffee. He revealed that coffee farmers have seen an increase in earnings, with prices rising from Ksh. 38 per kilogram to Ksh. 50 per kilogram.  

"Farmers are now paid directly by the miller, and after auction, they receive their payments directly into their bank accounts every 10th of the month in dollars. This is a good opportunity for farmers to consider," Oparanya stated. 

The CS also addressed concerns about the Hustler Fund, acknowledging that previous laws made it difficult to track borrowing and repayment trends. He noted that the government is working on measures to improve oversight and ensure the fund is effectively managed to support small businesses.  

The proposed reforms in the cooperative sector and financial regulations are expected to bring stability and growth to small businesses and farmers across the country.