TROUBLED SECTOR

Transporters accuse CS Macharia of ignorance

Macharia last Wednesday defended the government's decision that all imported cargo destined for Nairobi and the hinterland be transported via SGR

In Summary

• The stakeholders say Macharia has no facts about the industry and is misleading the President

• They want the government to sit down with them for honest discussion

Transport CS James Macharia
Transport CS James Macharia
Image: /FILE

Transport CS James Macharia makes has been accused of making irrational and often costly decisions out of ignorance.

 

Macharia has no facts about the transport industry, according to truckers, container freight station owners and vehicle manufacturers.

The stakeholders were referring to statements the CS made as he was questioned by the National Assembly Transport Committee last Thursday. He had told the MPs that it is cheaper to transport goods via the SGR than by road.

 

The stakeholders on Friday called on the government to sit down with them for an honest discussion. “You heard Macharia talking about SGR being cheap. He was talking about road transport taking two days to deliver containers to Nairobi. That is not true,” they said through Kenya Transport Association CEO Dennis Ombok.

Macharia defended the government's decision that all imported cargo destined for Nairobi and the hinterland should from August 7 be transported via SGR only.

The directive was jointly issued by the Kenya Ports Authority and the Kenya Revenue Authority.

This elicited an uproar from transport stakeholders and Coast MPs, forcing the ministry to suspend the directive to allow for consultation.

The transporters accused Macharia of misleading President Uhuru Kenyatta with his little or no facts about the industry.

 

“Every day, a truck goes to Nairobi, delivers a container and will be at the port the next day to pick up another container. Macharia was talking without basis. He doesn’t know what is happening on the ground,” Ombok said.

He said it costs an average of Sh80,000 to transport a 20-foot or 40-foot container from Mombasa to Nairobi via road compared to the SGR, which charges Sh90,000 for the same.

 

Ombok said the SGR charges Sh50,000 for transportation, Sh5,000 handling fee, Sh25,000 last mile, and Sh10,000 return charge for an empty container.

The last mile charge is the cost of transporting the container to its final actual destination after being cleared at the Inland Container Depot in Embakasi.

The directive would have adverse negative effects on consumers because extra costs incurred will be transferred to them eventually.

“We are not against the SGR. We are against the monopoly that the government is creating,” Ombok said.

He said heavy commercial transporters have invested Sh120 billion in trucks and they feared that this will go to waste should government monopolise the transport sector.

The truckers, Ombok said, have also invested Sh500 billion on land for their yards.

“We pay advance tax worth Sh675 million to the same government that does not want us to do business with them,” he said noting that they also pay Railway Development Levy.

“We are paying this levy to our competitor, the government. Why do we pay this in advance and then they want to compete with us unfairly?” Ombok asked.

He said the 23 CFSs in the country has been dormant due to lack of business affecting 6,000  direct employees and 42,000 employed indirectly.

The Sh46 billion investment pays Sh288 billion taxes annually.

Manufacturers, under KAM which has 800 members, lost Sh60 billion in terms of demurrages when the SGR was introduced due to delays caused by rail transport.

Ombok said KNCCI, which has 38,000 members who have employed about 90,000, will also be negatively affected by the directive.

The KLDTDWU has about 50,000 members who will lose their jobs should the government force investors to use the SGR to transport their cargo.

“On average over a million people risk losing their jobs because of such directives issued without consultation. This means about 15 million people will be affected by this directive,” Ombok said.

The SGR transports about 108 containers per trip, meaning 108 drivers lose their jobs per SGR trip.

The SGR makes about eight cargo trips to Nairobi daily.

“We elected this government on the platform of the creation of employment. They came and they have never created any single employment. What they got is what they are now killing,” Ombok said.

He said millions of Kenyans, directly and indirectly, depending on the transport sector for their living.

They include fuel service stations, motor vehicles and truck dealers, garages, trailer manufacturers, mechanics, loaders, drivers, warehousing, clearing and forwarding agent, roadside kiosks, hotels and eateries along the highways, among others.

 Even lower cadre personnel at the port will be affected.

Ombok feared this will result in lawlessness and insecurity.

He said it is wrong for the CS to say the SGR matter is a fight between Coast and Mount Kenya MPs.

“It is not a fight. If the Mount Kenya MPs are looking at it that way then it is the wrong way of looking at things.  Coast MPs are simply saying this is wrong. Give people their right of choice,” he said.

KLDTDWU deputy secretary Ahmed Omar said the SGR directive will have negative implications in the social and economic spheres of life.

Omar said the decision, if not properly reviewed will result in increased prostitution, school dropout rates, teenage pregnancies, highway crime, drugs menace and poverty.

“The government should not monopolize the transport sector. Let people choose,” he said.

He claimed the crime wave in Mombasa was an indirect result of decisions like that of the CS as they had led to unemployment.

The stakeholders included Kenya Transporters Association (KTA), Kenya Long Distance Truck Drivers and Allied Workers Union (KLDTDWU), Transport Workers Union (Tawu), Kenya Association of Manufacturers (KAM), Container Freight Station Association (CFSA), Kenya National Chambers of Commerce and Industry (KNCCI), and Kenya International Freight and Warehousing Association (Kifwa).