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Mbadi eyes new Sh4bn fund to spur business behind prison walls
Treasury Cabinet Secretary John Mbadi. He has proposed the dissolution of the Prison Farms Revolving Fund, formed in 1993, and the Prisons Industries Revolving Fund, formed in 1988.
The National Treasury has proposed a seed capital of Sh4 billion for the establishment of the Prison Enterprise Fund, which will oversee the production and sale of goods made by prisoners.
The State targets to merge the management of farms and industries in prisons – previously managed by two funds – into one enterprise that will be headed by a competitively sourced chief executive officer with a three-year renewable tenure.
In regulations issued by Treasury Cabinet Secretary John Mbadi, the government is seeking to optimise the vast land held by the 105 correction facilities and the cheap labour of prisoners by moving management to a semi-autonomous status.
“There is established a fund to be known as the Prisons Enterprises Fund. The object of the fund shall be to provide funds to support the development and operations of the prison enterprises,” reads draft regulations released by the National Treasury. “The initial capital of the fund shall be four billion shillings appropriated by Parliament in accordance with the Act.”
The funds will be used to develop and implement training and rehabilitation programmes for prisoners, purchase and maintain equipment and machinery for the enterprise, and market its products and services.
CS Mbadi has proposed the dissolution of the Prison Farms Revolving Fund, formed in 1993, and the Prisons Industries Revolving Fund, formed in 1988.
The two funds are in charge of marketing goods produced by the prisons department and were managed by an administrator appointed by the cabinet secretary in charge of correctional services. The government proposes to have a chief executive competitively sourced from the private sector.
The formation of the board is proposed to include two members of the public besides government officials from the ministry in charge of correctional services and the Treasury.
“The Prison Farms Fund established under the Exchequer and Audit (Prisons Farms Fund) Regulations, 1993, is wound up,” reads part of the regulations revoking the fund.
Similar revocation orders are issued regarding the Prisons Industries Fund.
The two funds had each received seed capital of Sh14 million on formation. They had grown their assets to more than Sh800 million, riding on a labour force of more than 5,000 prisoners hosted in 105 correctional facilities in the country. The Prison Department holds more than 22,000 acres of land with prisons hosted in vast areas as a deterrent to escapes. Some of the land, estimated 4,000 acres, have been encroached creating a need for more stringent management of their assets.
Some of the goods produced by prisoners include furniture, textiles, metal works, and farm produce. The Prisons Department has long served as the car license plate production centre for the government.
Their wares are sold in exhibition centres across the country.
The two funds had been cited by the Auditor-General for operating a joint account, which made it difficult to differentiate the financial performance of each fund. The auditor had also taken issue with the funds failing to adopt technology in their systems, with all processes, including accounting being done manually.
The government has been taking steps to improve the Prison department by improving the conditions of the inmates and also empowering the wardens.
