Analysis of Route Management in the Matatu Industry in Nairobi: a Case Study of Cartels

Abstract

Transport plays an important role in integrating the various sectors in the Kenyan economy just like elsewhere in the world. It is estimated that the matatu industry in Kenya controls over 80 per cent of passenger transportation. In spite of this important role, this study shows that the industry is poorly coordinated, with functions relevant for efficient operations located across different government departments and agencies. Further, the industry is characterized by a number of stakeholders with conflicting interests. The growth of the industry has not been effectively facilitated by the government. The government under the Ministry of Transport (MoT) is charged with responsibility of provision of services, policy guidelines, coordination and law enforcement relevant for effective management of the operations of transport service. However, due to disjointed nature of the government institutions and departments the industry is marred with illegal groups who extort money from the public to make a living. This study was conducted with an aim of shedding light on institutions, which manage matatu routes in Nairobi, with a major focus on cartels. The study provides information on cartels who are thought to be involved in unlawful activities creating fear in the general public, and operating in the midst of government institutions and departments. Areas investigated include: ^lae origin, existence and involvement of cartels in the management of matatu industry. Dandora was chosen as a study site, in particular route number 36. Located in the eastern part of Nairobi, Dandora estate is one of the many suburbs, which is highly populated. Majority of the residents are low income earners, very insecure with high crime and unemployment rates. These attributes partly contribute to the area housing some of the most dangerous illegal groups, including cartels who manage the matatu routes The study findings indicate that the cartels came into the industry as a result of the unregulated vacuum created by the absence of government institutions and departments at the route level. The study reveals that the cartels are assigning routes to matatu owners even after matatu owners have been assigned routes by the Transport Licensing Board (TLB), regulating vehicle entry into a route by charging illegal fees, preventing those who have not paid the fees from operating, preventing others from invading the route; controlling fares charged to passengers; and collecting daily fees from matatu operators claiming that it is protection fees. It was evident that colossal sums of money are collected from the operators, while the services purported to be offered are not rendered. The study makes a number of recommendations as a step towards finding a lasting solution to cartels, including the need for government to facilitate formation of a unified body to run the transport sector. Other recommendations include: harmonising roles and responsibilities of various government departments and agencies in order to effectively manage and regulate the industry and facilitating the civil associations to work together; facilitating the formation of various groups operating within the matatu industry into Savings and Credit Cooperatives (SACCOS) with organized rules and regulations and laid down penalties for offenders. This has potential of reducing and eventually eliminating cartels in the management of matatu routes.