Storm in Parliament over forced SGR cargo useTuesday August 06 2019
Parliament has summoned Transport Cabinet Secretary James Macharia over a directive that forces importers to use the standard gauge railway (SGR) for goods coming to Nairobi and beyond from the Mombasa port.
National Assembly Deputy Speaker Moses Cheboi directed Mr Macharia to appear before the Transport committee Thursday at 10.00 a.m.
Last Friday, the Kenya Revenue Authority (KRA) and the Kenya Ports Authority (KPA) issued a joint public notice to importers requiring them to move their containers from Mombasa to Nairobi Inland Container Deport (ICD) through the SGR.
The move looks set to boost SGR cargo revenues, but hurt road truckers and operators of container freight stations in Mombasa that operate like clearance ports. The SGR line has struggled to attract adequate cargo volumes, with investors balking at the tariffs to transport goods from the Mombasa port to the ICD in Nairobi.
On Tuesday, Mvita MP Abdulswamad Nassir said the order by the KRA and the KPA will effectively kill container freight stations along the Mombasa-Nairobi highway, cripple transporters and force closure of warehouses, leading to massive job losses.
“This is an illegal directive purportedly signed by both KPA and KRA to compel all importers of cargo to use the SGR. They gave a reason that it is for the purposes of efficiency but we have raised the matter in Parliament and the mood of the House is that this is very wrong,” Mr Nassir said at a press conference.
The he directive by the KRA and the KPA, he said, was not tabled in Parliament for approval as required by the Statutory Instrument Act, 2013.
Mr Nassir was supported by Leader of Majority Aden Duale and his Minority counterpart, John Mbadi, who demanded Mr Macharia and the KRA commissioner-general, James Mburu, be summoned.
Freight services, which started in January 2018, generated Sh4 billion in the year to December while passenger ticket sales were Sh1.61 billion, putting SGR revenue at Sh5.6 billion.
The revenue was not enough to meet the operation costs, which were earlier estimated at Sh1 billion a month or Sh12 billion a year. This prompted an increase in freight charges this year and passenger fares for children on Mombasa-Nairobi trains by 100 per cent.