Public servants set to lose allowances if plans by SRC go through
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Public servants set to lose allowances in a bid by SRC to ballooning government wage bill
Public servants set to lose allowances in a bid by SRC to ballooning government wage bill.
In an effort to rein in the spiraling wage bill, which has nearly doubled in size over the past six years, the government plans to eliminate retreat, sitting, and non-practice allowances for public employees.
After experiencing an average annual growth of Sh72 billion since 2016, the public wage bill finally surpassed the Sh1 trillion mark in the year ending in June 2022.
The Salary and Remuneration Commission (SRC) has been unable to implement new standards for a variety of allowances because of resistance to its attempts to limit the benefits by eliminating fat allowances that public servants use to boost their monthly compensation.
And, with expected salary increments for teachers, who are seeking a KSh56 billion pay rise, and members of disciplined forces, the wage burden will increase.
The commission in October 2021 issued guidelines to cut the ratio of allowances to basic salaries in the public service at 40:60. It had found that public entities were paying up to 247 allowances, constituting up to 259 percent of gross pay, where it should have been just 40 percent.
“Public service institutions shall be required to furnish SRC with all allowances payable in their institutions for review, setting, and advice, to ensure fiscal sustainability and affordability,” SRC stated in 2021.
“The commission will then review and issue advice on allowances to the individual public service institutions by April 29, 2022, following which the compliance checks to enhance adherence to the policy guidelines will be conducted in July 2022,” SRC Chairperson Lyn Mengich said.
But a stiff resistance SRC has faced in its push has seen it make little to no progress nearly two years later, leaving the burden to taxpayers who continue to shoulder an unnecessary load.
SRC revealed that while it has started the process of streamlining allowances among state officers, the process to control allowances among the majority of government workers who form the bulk of nearly a million employees faces resistance.
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“SRC has accomplished Phase I implementation in the allowance initiative, and is currently implementing Phase II where part of the cross-cutting allowances proposed for review are undergoing stakeholder and public participation, awaiting review, setting, and advice.”
“In phase I, SRC has streamlined the allowances for state officers in setting the remuneration and benefits. In Phase II, SRC will review and advice on cross-cutting and common allowances in the public service,” Ms. Mengich said.
She revealed that among those targeted for review are the retreat, sitting, and non-practice allowances.
SRC says public institutions are frustrating its efforts with delays and litigations.
SRC had promised to review and advice state entities on payable allowances by April last year but has not done so, with the commission last week saying: “The impact on the public wage bill is long term and will only be determined after the full implementation of streamlining of allowances in the public service.”
In the year to June 2022, the public wage bill ate into 46.3 percent of government revenues, up from 44 percent in the previous year and 41.9 percent in 2019/20.
The Public Finance Management (PFM) Act, 2012, requires that public institutions shall not spend more than 35 percent of revenues to pay salaries.
But public institutions have shown determination to protect the allowances, as they accuse SRC of overstepping its mandate.
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