Civil servants set for 7.3pc pay increase starting July

Salaries and Remuneration Commission chairperson Sarah Serem. FILE PHOTO | NMG 

By NEVILLE OTUKI

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Summary

• Treasury has allocated an additional Sh26.5 billion for salaries, lifting the total wage budget to Sh386.5 billion in the coming year, from the current Sh360 billion.
• State House last month announced a fresh pay package that will see civil servants’ salaries increase annually by Sh25 billion over the next four years, starting July, translating to a total pay hike of Sh100 billion.
• This marks the first pay increase for the entire civil service under the Jubilee administration.

Civil servants are set for a 7.3 per cent pay rise starting July which includes higher housing and hardship allowances ahead of elections.

Documents submitted in Parliament indicate that the Treasury has allocated an additional Sh26.5 billion for salaries, lifting the total wage budget to Sh386.5 billion in the coming year, from the current Sh360 billion.

The increment affects only employees working for the national government.

Last month, State House announced a fresh pay package that will see civil servants’ salaries increase annually by Sh25 billion over the next four years, starting July, translating to a total pay hike of Sh100 billion.

Treasury documents show that out of the Sh26.5 billion salary increment allocation for next year, Sh20 billion will go towards harmonisation of salaries and allowances for national government employees. This is in line with recommendations by the Salaries and Remuneration Commission (SRC).

The remaining Sh6.5 billion is for the implementation of the third phase of housing and hardship perks.

This marks the first pay increase for the entire civil service under the Jubilee administration and comes on the back of heightened pay spats that recently saw doctors and university lecturers go on strike.

It also signals President Uhuru Kenyatta’s intention to quell a string of strikes which have rocked his administration ahead of the August 8 General Election. Doctors and lecturers pay will, however, be covered in the counties and universities allocation budget.

The SRC last November unveiled a new job structure for public servants in efforts to bridge the huge wage disparities in the public service.

In the new arrangement, civil servants possessing same skills, qualifications and experience will be clustered in the same job group regardless of whether they are employees of the national government, county governments, constitutional commissions, state corporations or independent commissions.

The government has in recent years been reducing Kenya’s ballooning public sector wage bill, saying it is unsustainable.

Mr Kenyatta’s administration has been struggling to keep workers’ cost at no more than 35 per cent of shareable revenue through pay and hiring freezes against pressure from unions.

The pay hikes come in a year when the country’s economic growth rate is expected to be slow, from about 5.9 per cent last year, due to sluggish credit growth as investors take a wait-and-see attitude before elections in August, says the International Monetary Fund.

Kenya runs a bloated public wage bill which stood at Sh568 billion in the 12 months to June 2015 or 52 per cent of total revenues, squeezing development spending which is the driver of economic growth.

The public wage bill is 17 per cent above the global average of 35 per cent for middle-income countries and has been a point of concern for the Jubilee government.