Kenya Railways Corporation - 2006 Management Change

2006 Management Change

The KR has suffered from inefficient management, has a bloated work force, and has run deficit operations in spite of its potential. For several years there had been plans to privatize and revitalize the system. In 2005, Rift Valley Railways Consortium (RVRC) from South Africa won the concession to run KR and Uganda Railways Corporation. RVRC was to take over operations on 1 August 2006 and intends to stream line operations, reduce the work force, and make major investments to upgrade the system. On 28 July 2006 the East African Standard reported that the planned take-over was postponed to 1 November 2006. This operational take-over took place in November and is scheduled to last for 25 years.

On 9 October 2008, Toll Holdings of Australia announced that it has entered into a contract to manage the Kenya-Uganda railway, replacing the management by Rift Valley Railways Consortium. The consortium has been criticized for falling freight traffic in the two years since taking control, while RVR alleges the drop is due to the poor condition of the railway infrastructure and the damage done by protesters during the 2007–2008 Kenyan crisis. Officers from Toll subsidiary Patrick Defence Logistics were to manage the railway after the transition.

Towards the end of 2008, after just a few months in charge, Toll pulled out of its management obligations after disagreements with the owners and the Toll appointed MD resigned, mirroring a similar reversal of appetite that occurred when Toll took over Tranz Rail (New Zealand's privatised rail operator) in 2003.