The move to stop the registration of Saccos by the Transport Licensing Board (TLB) spells trouble for the extortionist groups that have faulted the enforcement of reforms in the transport sector.
This follows months of struggle for matatu operators to brace the new directive that was aimed at improving the transport sector’s management amid the looming of illegal Saccos .
The Government initiative that began last year required all public transport operators to form Saccos or limited liabilities to improve services in the sectors management. The move saw the end to licensing individual operators and the 14 seater matatus.
Barely had the reforms taken shape, than cartels started crafting ways that will serve their needs by earning cash in unscrupulous methods. The groups resorted to posing as registrars turning the genuine matatu owners to desperate members.
According to a recent study by the Co-operative College of Kenya on the impact of the new integrated National Transport Policy on the 14-seater matatus, some established Saccos were found to charge exhorbitnat registration fees, rejecting potential members and even going to the extent of threatening to hand operators to illegal gangs.
“Gangs commonly referred to as cartels rushed and registered Saccos especially in Nairobi. To make the matter worse, some members of the cartel do not own even a single vehicle,”said the report.
Genuine matatu owners were forced to pay between Sh30,000 and Sh100,000, with the amounts directed to the imminent gangs.
The report said that Saccos are under threat with the phasing out of the 14-seater matatus, as the disintegration in pulling together resources to buy bigger capacity vehicles will be a tall order,if the necessary interventions will not be put to place.
While the Co-operative Development and Marketing minister Joseph Nyagah persisting that matatu operators will have to change the way they conduct business to fit into the new system the report revealed that 60 per cent of the board members of registered Saccos are unfamiliar with the new transport policy.
“ Saccos should merge into stronger and more viable units and amalgamate their welfare accounts to create a “bigger book” that could attract banks and other donors.,” said Nyagah.
Matatu Owners Association (MOA) also acknowledges the existence of cartel-like Saccos adding that the groups have been operational even before the directive was put into place
“Some gangs were smart enough to join Saccos even before the government directive came. the gang like nature of the transport sector has deep roots and “certainly has found its way even into companies and Saccos.” he said adding that it is a high time to end the illegal business.
The Transport Licensing Board (TLB) has come out strongly to take the initiative of bringing down the illegally registered Saccos, following an outcry by the operators who have lamented on the fear they have been subjected to.
The licensing board chairman Ole Kamwaro, while giving a sturn warning to the cartels, he said that the fight has began and already he has walked the talk by sending 15 officials from his office parking after they were found in corrupt deals.
“We will unearth those illegal sects that have embarked on minting funds from the public service vehicles, they will face the direct consequences for corrupt deals, I have started with my office, I wonder why one would be engaged in such acts, this is illegal and unacceptable,” said Ole Kamwaro.
He added: “We will only deal with real Sacco’s in offering services to the Matatu sector and there is no need of some hooligans ganging up to form a Sacco as one way of getting quick money from the Matatu industry.”
The licensing board has so far warned the Matatu operators of persuing shortcuts to acquire illegal documents from the brokers saying that they risk being deregistered completely. The board is calling upon operators to seek legitimate Sacco representatives for original licences.
Currently there are about 60,000 matatus in the country with 14,000 plying the Nairobi capital’s routes. Accounting to 80 per cent of the public transport, they contributes an estimated annual turnover of 73 billion shillings with the transport sector 4 billion shillings to insurance companies and one billion in taxes.
Registering a Sacco from the Government requires a maximum of 600 shillings, 4,000 less than the minimum charged by the cartels. According to this years economic survey the number of registered 14 seater matatus declined by 19 per cent. This is attributable to the reforms in the transport sector.
So far at least 700 transport Saccos have been vetted and allowed to operate across the country.
