Converting civil servce into contract workforce is a dangerous gambit

Certainly, Moses Kiarie Kuria, the maverick Cabinet Secretary for Public Service, Performance and Delivery Management, is not your dyed-in-the-wool Marxist.

But in his recent edicts on the future of the civil service personnel, he seems to be, unwittingly, courting one of the most eclectic and riskiest ideas associated with Marxism: the “creative destruction” theory.

I presume that, as a student of accounting and finance, Kuria is familiar with the Austrian economist and finance Minister, Joseph Schumpeter, who coined the term “creative destruction” in 1942 to describe how the old is being constantly replaced by the new.

Kuria’s sensational proposal to convert all public servants — from President William Ruto to the sweeper — “from permanent and pensionable to contract and still pensionable” has an indelible hue of Schumpeter’s ‘creative destruction’, a mantra of “out with the old, in with the new.”

The idea is at the core of the popular book on long-term economic development, Why Nations Fail, by Daron Acemoglu and James Robinson who posit that the major reason countries stagnate and go into decline is the willingness of the ruling elite to block creative destruction, a beneficial process that promotes innovation.

Disruption as innovation is a dangerous gambit as its aim is not orderly reform to ensure stability. Instead, it assumes that long-standing arrangements, assumptions and practices must be dismantled to free up resources and energy to be deployed for innovation.

Marxists predicted that the creative-destructive forces unleashed by capitalism would eventually lead to its demise as a system. In recent decades, capitalism and the international liberal order have fallen into a serious crisis.

Kuria’s proposal to convert all public servants to contract workers is not secured in the science of reform. It is a populist response to the strike by at least 4,000 doctors who, since March 14, 2024, have called on the Government to honour the 2017 Collective Bargaining Agreement (CBA) it signed with them, including employment on permanent and pensionable terms.

The government has invoked post-truth politics based on the wage bill to sway public opinion. “There is something wrong when one million people take half of our tax revenues and the 53 million people take the other one,” Kuria said. This sounds more like the biblical speck-and-the-log hyperbole than a statement of fact.

Kenya’s workforce and wage bill do not seem to deviate radically from the continent and global trends in ways which call for draconian measures. According to the Economic Survey 2023, Kenya’s total workforce stands at 12 million.

Approximately 2 million are in the formal sector, which includes civil service, parastatals, and private sector employees. Total public sector employees by 2024 is 968,425, according to the Salaries and Remuneration Commission (SRC). This compares favourably with 1.2 million public servants in South Africa and 720,000 in Nigeria.

Moreover, a press statement released August 9, 2023 by the SRC on remuneration and benefits payable in the public service stated that Kenya’s ratio of wage bill to GDP has declined from 8.4 per cent in 2018 to 7.58 per cent in 2023 — and is projected to decline further to 7.19 per cent in 2024. Manifestly, the wage bill crisis is alarmist, intended to drown the doctors’ demands.

The real trouble with Kenya’s wage bill does not lie with the traditional civil service but is simply the failure of the Kenya Kwanza administration to faithfully implement its bottom-up economics. Instead, Kenya is a classic case of “too many chiefs and not enough Indians” as the regime prioritised top-heavy policies of rewarding its cronies.

A new advisory by the SRC indicates that salaries of 50 Chief Administrative Secretaries hired in March 2023 is Ksh780,000 (nearly half a billion annually) plus emoluments. Even before Kuria’s axe falls, the government is already losing its productive employees to the private sector, which pays better salaries and other emoluments.

Kenya should prioritise cleaning the payroll to weed out ghost workers. In 2021, the federal government of Nigeria introduced the Integration Personnel and Payroll Information System (IPPIS), which enabled it to weed out of about 70,000 ghost workers from the service, reducing the Federal Civil Service personnel to 720,000.

Changing the terms of employment from permanent to contract as a cost-saving measure is not backed by any known branch of science or factual data. The connection between converting civil servants into contractual staff and sorting out the wage bill appears spurious — unless ‘contract’ means mass lay-offs or retrenchments.

Since Kenya adopted its 2010 Constitution, it is committed to the rule of law in all sectors, including the public sector. It is unimaginable that an employer can just change the terms of service midway by fiat or at a whim.

This will attract many serious cases that will hobble our judiciary. In any case, the idea of turning civil servants into contract workers, as tantalising as that may be, has never worked anywhere. Public servants are in public service due to the ‘permanence’ of their terms of service.

Moving forward, the Kenya Kwanza elite need to return to reason and realise that the civil service is the backbone of a modern state without which it cannot stand.

Despite evidence of corruption, nepotism and cronyism in the civil service, civil servants — who include public school teachers, public university lecturers, doctors and nurses in public hospitals — are, by and large, about the only personnel who are chosen and promoted based on merit and seniority, which sometimes involve examinations.

The Kenya Kwanza pundits must take hard lessons from history. As constituted, public service started in China where standardised competitive examinations were introduced as a basis for civil-service recruitment and promotion purely on merit. In Ancient Greece, public servants were seen as paragons of virtue. After the 19th century, France, Britain and America adopted the civil service, with independence, impartiality vis-à-vis political parties and tenure as an important principle in modern times.

Governments come and come every five years. However, Public Service is the institutional memory, repository of skills and custodians of values. And by dint of its tenure, the civil service typically survives transitions of political leadership.

The idea of converting civil servants into contract workers is a dangerous gambit and an assault on the principle of civil service independence likely to destabilise public service and lead to state decay and dysfunctionality.

- Professor Peter Kagwanja is former Government Adviser (2007-2013), the Africa Policy Institute CEO, Adjunct Professor University of Nairobi & Visiting Scholar at the National Defence University-Kenya.