By Nyakundi Bw’Otwere
President William Ruto on Tuesday signed the Government-Owned Enterprises Bill, 2025 (GOE Bill) into law at State House, Nairobi.
The legislation represents a sweeping overhaul of the governance, financial oversight, and operational efficiency of Kenya’s commercial State corporations, setting the stage for a more accountable and performance-driven public sector.
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The GOE Bill is a cornerstone of President Ruto’s broader reform strategy to improve service delivery, reduce the fiscal burden of underperforming parastatals, and promote transparency in state enterprise governance.
Speaking during the signing ceremony, the President emphasized the urgency of transforming public institutions into engines of national growth, noting that many corporations have historically underperformed and drained public resources.
The new law, he said, lays the foundation for self-sustaining enterprises that operate efficiently, deliver value to citizens, and contribute meaningfully to national development.
At the heart of the new law is the establishment of the Government-Owned Enterprises Authority (GOEA), a central oversight body tasked with enforcing governance standards and evaluating performance across all commercial State corporations.
It also mandates performance-based contracts for CEOs and senior managers, tying leadership tenure to measurable financial and operational targets.
Board governance has equally been tightened, with new criteria for appointments and mandatory annual performance appraisals. Underperforming boards now face dissolution and reconstitution.
Additionally, the Bill outlines frameworks for partial or full privatization of non-strategic enterprises through structured and transparent processes. GOEs are expected to gradually shift away from dependence on the national budget by adopting self-financing models such as debt restructuring and capital market engagement.
Economists and policy analysts have lauded the GOE Bill as a timely and necessary intervention.
Kenya is home to over 260 State corporations, yet only a handful consistently turn a profit. A 2023 Treasury report revealed that more than KSh 300 billion was spent on parastatal bailouts over a ten-year period.
According to Dr. Mary Kendi, a public finance expert at the University of Nairobi, the Bill’s real promise lies in its emphasis on fiscal discipline and results-oriented management, offering a path to saving billions in public funds—provided it is implemented with fidelity.
However, implementation is not without challenges. Experts warn of resistance from entrenched interests, capacity constraints within corporations, and potential political interference.
Civil society organizations have already sounded the alarm, urging vigilance to ensure the reforms are enforced with integrity.
Transparency International Kenya, for instance, has called on the government to publish annual audit reports of all GOEs and to include the public in the reform process.
Beyond State corporations, the Cabinet also approved a raft of transformative projects and policies during the same cycle.
These include a major upgrade to the Nairobi Northern Bypass, which will be converted into a 20.2-kilometer dual carriageway featuring eight interchanges, pedestrian and cycling infrastructure, and improved links to key economic hubs in Nairobi and Kiambu.
Another signature project is the Nairobi Railway City Central Station redevelopment, aimed at modernizing the Central Station into a multi-modal hub with nine platforms, new access bridges, and the capacity to process up to 30,000 passengers an hour by 2030.
The hub will integrate with BRT Line 3, commuter rail, and the SGR line to JKIA, complemented by surrounding land redevelopment and economic revitalization.
The Affordable Housing Programme also received a boost through new regulations that lower the required deposit from 10% to 5%, support low-interest mortgages, and introduce legal frameworks for county-wide development.
Meanwhile, to strengthen public procurement, the Public Procurement and Asset Disposal (Amendment) Bill, 2025, mandates e-procurement for all government tenders, bolsters local sourcing, and sets inclusion targets for women, youth, SMEs, and persons with disabilities—all while embedding anti-corruption safeguards.
The government further endorsed the National Policy on the Prevention of Alcohol, Drugs, and Substance Use (2025), which expands NACADA’s mandate, curbs harmful advertising, and promotes youth protection and evidence-based community interventions.
Finally, under the Higher Education, Science and Technology Phase II Project, public universities will benefit from new STEM infrastructure, science parks, and research laboratories.
The program promotes competency-based education, postgraduate training, industry partnerships, and youth-focused skills development, with a particular emphasis on increasing women’s participation in STEM.
