Uhuru pledges to protect jobs for Kenyans

President Uhuru Kenyatta on Wednesday announced a 14 per cent increase in the minimum wage.

The President directed that the new pay be implemented “with immediate effect”, a pronouncement that was greeted with loud applause during Labour Day celebrations at Nairobi’s Uhuru Park.

He said his government would also step up measures to ensure that unskilled and other jobs that can be done by Kenyans would be limited to citizens.

“Taking into account the needs of our lowest paid workers and cost of living while ensuring a condusive environment for investment and job creation, my government has awarded a salary increment of 14 per cent on the minimum wages,” he said.

Cotu secretary-general Francis Atwoli had earlier said the government could comfortably increase the minimum wage by between 30 and 40 percent, if it sealed all tax evasion loopholes.

Mr Atwoli claimed that between 2010 and last year, Sh354 billion was not paid in taxes by key sectors despite collecting at least Sh7.1 trillion.

“If taxes were being remitted to the Kenya Revenue Authority and profits accrued being shared equitably, the 30 to 40 per cent increment won’t hurt this economy,” he said.

President Kenyatta used the occasion to urge Kenyans to support the local textile industry, saying it could be a major source of employment.

He said the government would implement the National Employment Policy and Strategy for Kenya which was approved by the Cabinet last year.

“This policy outlines the strategic interventions to be made in key sectors of the economy that have high-potential for job-creation, income generation and poverty reduction,” he said.

The Head of State stated that through this policy, all major investments and projects in the country would be subjected to an employment creation analysis to determine their employment creation potential.

“In this regard, my office will require State departments to conduct analysis to determine the number of jobs that they will avail to our youth.”

Mr Kenyatta asked the National Assembly to expedite the enactment of the National Employment Policy into a sessional paper to set the process in motion.

He said the government would pay special attention to the micro and small  enterprise sector, which is a major player in the economy in terms of employment creation and poverty reduction.

He said the government would conclude bilateral agreements with key destination countries to address challenges Kenyans seeking employment abroad faced.

Last year, the government increased the minimum wage by 13.1 per cent enabling the lowest paid worker in major towns to earn Sh8,579 per month. The increase in 2010 was 10 per cent.

Wednesday’s 14 per cent increment means that the lowest paid worker will now be earning at least Sh9,780.

Mr Kenyatta, who was accompanied by Deputy President William Ruto, all his Cabinet Secretary nominees and Nairobi Governor Evans Kidero, said no economy could sustain high wages and salaries if it did not adequately address productivity and national competitiveness, which in Kenyan case were low by international standards.

“We will address these issues. A culture of productivity and performance management target setting must be embraced.”

Mr Ruto said the cost of living in the country must be reduced. This must include the reduction in prices of food, he said.

“Farmers must have access to good seed, fertilisers, and other inputs at affordable prices to lower the cost of food production,” he said.

Kenyans, he added, must also have access to a comprehensive universal medical scheme.

Mr Atwoli warned the government against privatising parastatals, saying this would push the government out of business and thousands of workers out of work.

He said the government should support initiatives that would make Kenya attain an economic boom, promising that workers were ready to play their role.

The Cotu boss also said the union was concerned with the recent decision by the Judicial Service Commission to convert the Industrial Court into a division of the High Court.

“We ask them to reconsider this position,” he said.

He asked the President to merge the National Social Security Fund and the National Hospital Insurance Fund so that the single institution could meet the constitutional requirement of both social protection and provision of health for Kenyans.

The rally was also addressed by the Federation of Kenya Employers chair Erastus Mwongera, who stated that the government wage bill was too high.

Serious challenges

Mr Kenyatta regretted that Wednesday’s celebrations were being held against a backdrop of serious challenges in the labour and employment sectors.

He was concerned that of the 750,000 people that entered the job market annually, only 500,000 were being absorbed, mostly in the informal sector.

“We also have 21 per cent national underemployment, 40 per cent total unemployment and 70 per cent unemployment among the youth,” he said.

“The creation of productive, decent and sustainable employment opportunities will therefore be my central policy priority of my government,” he said.