Workers at the Githunguri Dairy plant in Kiambu last week. Photo/SALATON NJAU
Over 10,000 dairy farmers in Kiambu County are up in arms over new regulations on co-operative societies.
Githunguri
Dairy Farmers Co-operative Society wants orders stopping implementation
of the new rules, arguing that it will give advantage to their
competitors in the dairy industry.
“Regulations by the
Cabinet secretary in charge of Treasury requiring all co-operative
societies to apply public procurement rules in their operations are
unconstitutional since they violate the farmers rights to own a
business,” said their lawyer Kamau Kuria.
Under the
fresh rules, the Treasury classified co-operative societies as public
institutions and they are required to follow the Public Procurement and
Disposal Act in buying their products.
The regulations
stipulate that co-operative societies must involve officials from the
National Treasury, ministry of Devolution and a team from public
procurement board in their business.
The co-operative society argued that the requirement would force it to provide its confidential business information to rivals.
“The
regulation will compel the society to do business with women, youth and
persons with disability whose business records are unknown. It will
also make us spend much time and money procuring our goods and
services,” said Mr Kuria.
WRONG ASSUMPTIONS
The
lawyer argued that the regulations are based on wrong assumptions that
co-operative societies are public entities when they are private
organisations run by members.
“The effect of the
regulations is to severely restrict the members from exercising their
freedom of contract and to make its businesses uncompetitive. It is also
intended to give its rivals in the dairy industry registered as
companies an undue advantage in getting milk from farmers,” said Mr
Kuria.
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