Brace for hard times ahead if teachers' pay rise is effected, warns PS
What you need to know:
- The National Treasury also released details of harmonised salaries for teachers and other civil servants, warning that if the new pay rates are implemented, the teachers would be earning much more than their public service counterparts.
- In an advisory to the Teachers Service Commission, which places the cost of the 50-60 per cent salary raise at Sh20.1 billion until the next budget, the Treasury warns of far-reaching economic consequences if they pay up.
- National Treasury Principal Secretary Kamau Thugge said the government has been operating under a tight taxation framework since the Budget was read in June such that even a proposal to increase funds to counties by Sh3 billion was met after "raiding" money meant for the Judiciary, the Senate and other institutions.
The government is unable to implement the new salary rates for teachers because it wants to avoid subjecting the public to higher interest rates on loans and slowing down economic growth, it has emerged.
The National Treasury also released details of harmonised salaries for teachers and other civil servants, warning that if the new pay rates are adopted, teachers would be earning much more than their public service counterparts.
In an advisory to the Teachers Service Commission, which places the cost of the 50-60 per cent salary increase at Sh20.1 billion until the next budget, the Treasury warns of far-reaching economic consequences if they pay up.
National Treasury Principal Secretary Kamau Thugge said the government has been operating under a tight taxation framework since the Budget was read in June such that even a proposal to increase funds to counties by Sh3 billion was met after "raiding" money meant for the Judiciary, the Senate and other institutions.
FLUID SITUATION
“The TSC may wish to recall that the resultant cost from the award was not budgeted for in the 2015/16 financial year. In addition the 2015/16 Budget was prepared under a very tight fiscal framework with no scope for additional expenditures,” he said in the letter dated August 28 to TSC chief executive officer Nancy Njeri Macharia.
Dr Thugge added: “The availability of additional resources has not changed.”
The letter was copied to Chief of Staff and Head of Public Service Joseph Kinyua, Attorney-General Githu Muigai, Education Cabinet Secretary Jacob Kaimenyi and Defence Cabinet Secretary Raychelle Omamo.
The letter, which was leaked yesterday, will work to stir the already fluid situation where teachers unions — the Kenya National Union of Teachers (Knut) and the Kenya Union of Post Primary Education Teachers (Kuppet) — have advised their members to down their tools to force the government to pay.
The crisis was heightened after Central Organisation of Trade Unions (Cotu) Secretary-General Francis Atwoli and Trade Union Congress of Kenya’s (TUC-K) Charles Mukhwaya, threatened to call their members out to the streets to join teachers in forcing the government to pay.
PERILOUS CONSEQUENCES
On Monday evening, the Union of Kenya Civil Servants issued the same threat, which if executed, would bring the country to a standstill.
In spite of the pressure, Dr Thugge was categorical that the two options, raising taxes or borrowing, would result in perilous consequences.
“In view of the foregoing, the National Treasury is unable to provide the additional funding required to implement the salary award,” he stated.
The PS said that should the government opt to increase taxes in order to raise money to pay teachers, the net effect would be to slow down the growth of the economy and blow away any possibilities of creating job opportunities.
The second option of borrowing, which he said was against the provisions of the Public Finance Management Act, would be more detrimental to the economy
“Moreover, such borrowing, if it was to take place would push interest rates upward and this too will negatively impact private sector investments, growth and standards of living,” Dr Thugge warned.
