In response to a surge in cooperative scams, Cooperatives Cabinet Secretary Wycliffe Oparanya has announced plans to introduce a new bill in the National Assembly aimed at enhancing the governance of cooperative societies. The Cooperative Societies Bill of 2024 seeks to protect members’ savings while addressing ongoing governance challenges in the sector.

During his remarks at the annual general meeting of Lompasago Sacco in Nairobi, Oparanya stated, “The cooperative sector is still plagued by many issues. Poor governance is a major concern. Some cooperatives are managed terribly, leading to outright theft of members’ funds.”

The upcoming legislation will clearly define the roles and responsibilities of cooperative members, boards of directors, and management teams. Oparanya further criticized the consistent re-election of board members, noting, “In some Saccos, the board chairs have been in office for over 30 years. Why can’t there be a term limit?”

The CS also highlighted the pressure members place on their Saccos for dividends, saying, “Members demand dividends even when their Sacco is making losses. This puts stress on the cooperatives and encourages mismanagement.”

Oparanya’s proposed bill is seen as a vital step toward curbing exploitation and ensuring a more transparent and accountable cooperative system for the thousands of Kenyans relying on these financial institutions. The Cabinet Secretary confirmed that the bill is ready and will be presented to Parliament soon.