Cooperative Bill set to strengthen governance and drive sector growth

The government has reaffirmed its commitment to modernizing Kenya’s cooperative movement through a new cooperative bill and increased public investment, aimed at strengthening governance, protecting members’ savings, and accelerating the sector’s contribution to economic growth.

Deputy President Prof. Kithure Kindiki said the Cooperative Bill, currently before Parliament, is a key reform that will align the sector’s legal framework with the realities of a rapidly evolving economy, where cooperatives manage billions of shillings in member savings, undertake major investments, and increasingly embrace digital technologies.

Speaking during the national Ushirika Day celebrations in Nairobi Saturday, Prof. Kindiki urged Parliament to fast-track the bill’s passage, saying it will improve governance, accountability, and professionalism while safeguarding more than Sh1 trillion in savings held by over eight million SACCO members.

“The proposed law will strengthen governance, improve accountability, protect members’ savings, and create a modern legal framework that enables cooperatives to compete effectively in today’s economy,” he said.

The DP noted that while legislative reforms are critical, they must be accompanied by increased government investment to unlock the sector’s full potential under the Bottom-Up Economic Transformation Agenda (BETA).

Backing a proposal by Cabinet Secretary for Co-operatives and MSMEs Development Dr. Wycliffe Oparanya for enhanced budgetary allocation to the State Department for Cooperatives, Prof. Kindiki said additional funding would support cooperative expansion, strengthen SACCOs, build institutional capacity, accelerate digital transformation, promote value addition, and improve access to affordable credit for farmers, traders, women, and youth.

“I want to assure the cooperative movement that the government is committed to creating the fiscal space necessary to increase investment in this critical sector,” he said.

The DP explained that once the National Infrastructure Fund becomes operational and assumes responsibility for financing major infrastructure projects, more resources would be available for productive sectors such as cooperatives, which directly create jobs and improve household incomes.

Prof. Kindiki said the government aims to double cooperative membership from the current 14 million to more than 28 million in the coming years through stronger institutions, modern legislation, and sustained public support.

He called on cooperative leaders, Parliament, development partners, and members to work together in building a transparent, innovative, financially resilient, and globally competitive cooperative movement.

On his part, Oparanya said the Cooperative Bill, currently before a parliamentary mediation committee, will strengthen governance by clearly defining the roles of the national and county governments, addressing long-standing institutional challenges that have slowed the sector’s growth.

He added that the proposed law, alongside amendments to the Sacco Societies Act, 2008, will improve accountability, modernize the regulatory framework, and align Kenya’s cooperative sector with international best practices.

Describing cooperatives as the most effective vehicle for wealth creation and poverty reduction, Oparanya said Kenya, which is among the world’s leading cooperative economies and Africa’s strongest cooperative nation, should position itself as a regional center of excellence.

He highlighted government interventions to revive the coffee sector through cooperative societies, support women and youth-led cooperatives, and strengthen livestock cooperatives through a Sh5 billion investment aimed at boosting production and farmers’ incomes.

Oparanya, however, appealed for increased funding to accelerate reforms and unlock the sector’s full potential in driving inclusive economic growth.

President of the International Cooperative Alliance (ICA) Africa and Chairman of the Cooperative Alliance of Kenya (CAK), Macloud Malonza, welcomed the ongoing legislative reforms, saying the proposed Cooperative Bill and the Sacco Societies Bill would enhance transparency, improve governance, and position cooperatives as stronger engines of economic transformation.

Speaking during this year’s Ushirika Day celebrations under the theme “Cooperatives for a Peaceful World”, Malonza urged cooperatives to champion peace and national unity as the country prepares for the next general election.

He said peaceful societies create a conducive environment for business, savings, investment, and sustainable development, adding that cooperatives, through their principles of democracy, solidarity, and shared responsibility, continue to promote social cohesion, create jobs, improve livelihoods, and reduce inequality.

At the continental level, he called on African governments and investors to increase investment in cooperative enterprises and leverage the African Continental Free Trade Area (AfCFTA) to expand regional trade, promote value addition, and strengthen economic self-reliance.

Malonza also commended the government for supporting agricultural cooperative value chains, particularly in the coffee, sugar, and dairy sectors, as well as implementing debt relief measures that have restored confidence among farmers and cooperative members.

He said a stronger cooperative movement would remain central to achieving inclusive economic growth, sustainable development, and lasting peace in Kenya and across Africa.

by Wangari Ndirangu