Home News Government to restructure loss-making state corporations

Government to restructure loss-making state corporations


Treasury Cabinet Secretary Ukur Yatani has announced plans to restructure loss-making state corporations.

In a statement on Thursday, the CS said the National Treasury conducted a financial evaluation of state corporations based on the services they provide.

“The national Treasury selected 18 major state corporations based on the size of their activities, strategic importance and financial risks to undertake an in-depth financial evaluation and fiscal risk analysis,” Yatani said.

Out of the 18, four corporations including Kenya Broadcasting Corporation (KBC), East African Portland Cement Company PLC, Postal Corporation of Kenya and Kenya Post Office Savings Bank were making losses.

Kenya Power and Kenya Railways Corporation were found to be unprofitable, while eight other corporations were operating below the cost of recovery.

“Restructuring of insolvent or loss-making government owned enterprises is expected to have limited costs for the Exchequer, given their direct and indirect financial linkages with the national budget.”

“Entities supporting social welfare have suffered losses in recent years mainly due to their constrained revenues and are likely to require government support to address their liquidity challenges because of their critical social mandates,” he said.

Source link