Sh1m fine for traders selling unga above Sh90
Retailers found selling the two kilogramme packet of subsidised maize flour above Sh90 now risk a fine of Sh1 million or a five-year jail term.
This follows the publication of a gazette notice giving legal backing for State control of sifted maize flour costs and marks the first time the order has been issued under a law passed in 2011 allowing price control of essential goods.
Kenya in May 16 announced subsidies of Sh6 billion to maize importers to help lower the cost of flour, which had shot up due to a regional drought.
The subsidy cut the price of a 90kg bag of maize to Sh2, 300 from above Sh4, 000, allowing the 2kg packet of flour to be sold for Sh90 against the market cost of Sh140.
This is now backed by Friday’s gazette notice labelled the Price Control (Essential Goods) (Sifted White Maize Meal) Order, 2017—which allows punishment of those selling the flour above the set maximum price.
“A person who contravenes the provisions of this Act commits an offence and is liable on conviction to a fine not exceeding one million shillings or to imprisonment for a term not exceeding five years or to both,” states the law guiding the order.
President Mwai Kibaki in September 2011 signed into law a Bill that allowed Kenya to return to price controls of any essential commodity after the practice was abandoned in the 1990s in favour of economic liberalisation.
The law allows the Finance minister to set maximum prices of gazetted essential commodities upon consultation with the relevant industry.
ROCKETING CONSUMER PRICES
Consumer prices in Kenya have rocketed this year and inflation hit a 57-month high of 11.48 per cent in April, taking it beyond the Treasury’s preferred upper limit of 7.5 per cent.
The order on maize flour is the first under the Price Control (Essential Goods) Act, 2011.
Rising prices of staple maize flour and other foods have become a political headache for President Uhuru Kenyatta as he seeks a second term in the August 8 General Election.
He is running against opposition leader Raila Odinga, who has used the high costs of living to portray the government as incompetent.
Kenya plans to subsidise importation of up to about five million bags until harvests come in.
CHEAP MEXICAN GRAINS
The gazette notice comes amid a shortage of the subsidised maize flour and millers reckon the scarcity will persist until early next month when staple food will hit shop shelves after the arrival of 445 000 bags of cheap Mexican grains.
The maize was expected to dock at Mombasa port today and take up eight days to be transported to the mills and back to shops, a pointer that the shortages will persist until the second week of June.
The Cereal Millers Association (CMA) said they have been unable to meet demand of the subsidised flour on reduced supply, terming the 335, 000 bags of cheap Mexican maize imported on May 9 as inadequate.
This has led to shortages on shop shelves and the scramble for the cheap flour in the few stores where it’s available.
Sugar, maize flour, beans and sukuma wiki prices have increased 21.6 per cent, 31.2 per cent, 21.3 per cent and 63.2 per cent respectively over the past year.