Govt promises 80 per cent of sugarcane workers to be retained as mills revive

The government has assured sugarcane workers that the ongoing leasing of public sugar mills to private investors will not result in widespread job losses but rather spur growth and create additional employment opportunities in the sector.

Speaking on October 6, 2025, Kenya Sugar Board Chair Nicholas Gumbo said that private millers will retain 80 per cent of the current workforce once the leasing process is finalised.

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He revealed that the remaining 20 per cent, mainly employees nearing retirement or those still in service due to delayed exit packages, will be gradually phased out after they receive their retirement benefits.

Gumbo described the leasing initiative as a “silver lining” for Kenya’s struggling sugar industry, noting that the modernisation and full maintenance of key factories such as Sony, Chemelil, Muhoroni, and Nzoia will enhance efficiency and profitability.

“Once these mills run at full capacity, sugar production is expected to double to 1.6 million tonnes annually, positioning Kenya as a potential net exporter of sugar,” Gumbo said.

He also highlighted that cane farmers are already benefiting from improved payment systems, with disbursements now made weekly instead of monthly or seasonally, a change aimed at boosting morale and increasing productivity.

The announcement comes amid tension within the sector, with workers’ unions expressing concern over potential layoffs and threatening industrial action if redundancy notices take effect on October 31, 2025. Unions are also demanding the payment of Ksh5 billion in salary and allowance arrears before any transition to private management.

Despite the concerns, the government maintains that the leasing plan is a necessary reform to revive the industry and restore competitiveness. 

Sugar factories leased

This comes a few months after President William Ruto defended the leasing of the four sugar factories to private investors, stating that the move was adopted in order to streamline the sector.

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Speaking during the 62nd Madaraka Day Celebrations in Homa Bay on Sunday, June 1, 2025, Ruto detailed the strategic investments made in the agricultural sector that were aimed at increasing efficiency and productivity.

The head of state further sought to clarify the leasing process that has sparked widespread uproar, especially from leaders hailing from the Western countries.

 “The recent competitive leasing of four state-owned mills, Nzoia, Chemelili, Muhoroni, and Sony, is another strategic step to inject efficiency, restore profitability, and safeguard farmers’ livelihoods,” Ruto said.

“Our goal is to modernise the mills, ensure prompt payment to farmers and workers’ salaries and wages, and transform these once-struggling factories into productive and sustainable enterprises. For years, these factories were financial burdens on the exchequers, surviving only on repeated taxpayer bailouts while failing to pay farmers and workers,” he stated.