Transport Cabinet Secretary Kipchumba Murkomen has rejected a proposed law that seeks to give his office powers to regulate matatu fares.
In submissions to the National Assembly’s Departmental Committee on Transport and Infrastructure, Murkomen said a comprehensive study and stakeholder engagement must be undertaken if price controls are to be introduced in the PSV sector.
He said the value and effect of the proposal need to be researched by competent institutions and ministries before introduction.
“We advise that a comprehensive study and stakeholder engagement should be undertaken on the Bill’s proposals to determine their practicability and ensure the same do not violate any conventions or treaties applicable,” he said.
The National Transport Safety Authority Amendment Bill 2-23, sponsored by Kimilili MP Didmus Barasa, seeks to establish guidelines for the regulation of PSV fares.
The Bill proposes the Cabinet Secretary, working in conjunction with the NTSA, be empowered to formulate regulations that prescribe both the maximum and minimum fares payable by passengers in public service vehicles.
Furthermore, the Bill lays out mechanisms for the periodic review of fares in public service motor vehicles.
Murkomen said trade liberalisation was part of a broader push in Kenya to decrease the government's role in the economy and give market forces greater influence.
He said price controls, widespread in the economy before the structural adjustment loans, were largely eliminated throughout the late 1980s and early 1990s.
He added that direct price- controls as a long-term measure have not worked in the past in Kenya and elsewhere.
“In addition, price controls will violate international and regional trade agreements that the country has signed,” he said.
The CS added that some of the bodies that ought to be consulted include (but not limited to) are the Ministry of Trade, the National Treasury, the Ministry of Foreign Affairs, the Competition Authority and the private sector.
In 2018, the then Minister for Transport sought approval from the National Assembly to amend the Traffic Act to give him powers to regulate fares in the Public Service Vehicle industries.
However, the proposal was not approved by Parliament.
NTSA (Amendment) Bill, 2023 seeks to amend the NTSA Act No.33 of 2012 to provide for the development of policy guidelines to regulate fares payable by passengers in Public Service Vehicles in the country.