Civil servants get marginal pay rise from this month

The government has marginally raised the salaries of thousands of civil servants by between Sh1,400 and Sh4,300 beginning this month.

In a letter dated June 4, 2018, the Cabinet Secretary for Public Service, Youth and Gender Affairs, Prof Margaret Kobia, said the new salaries will apply to civil servants in the national government in job groups “A” to “T” who will still be in service on or after July 1, 2018.

Her letter was addressed to the principal secretaries in various ministries, the Auditor General, Controller of Budget and all county commissioners and their deputies.

This will be the second year in a row that the government is reviewing the salaries upwards following the signing last year of a Collective Bargaining Agreement (CBA) with the unions representing the more than 600,000 civil servants.

The higher perks is part of a plan to raise the pay of civil servants by some Sh100 billion over the next four years. This is in line with reforms proposed by the Salaries and Remuneration Commission (SRC) in an effort to bridge the huge wage disparities.

MAXIMUM PAY

The first phase of the increments in the same job groups took place in July last year. In the new pay rates, a civil servant in the lowest earning job group “A” will now get a minimum of Sh13,280, up from Sh11,840, marking an increase of Sh1,440.

The maximum pay for a worker in the same group has been raised to Sh14,150, up from Sh12,510, an increase of Sh1,640.

Those in the highest earning group “T” will now go home with a minimum of Sh164,780, up from Sh160,600, an increase of Sh4,180. The maximum pay in the same group has been raised by Sh4,340 from Sh315,700 to Sh320,040.

“Officers converting into the new salary scales will retain their current incremental dates,” read the letter. “However, where the incremental date falls on July 1, 2018, officers will be granted their annual increment on existing salary scales before their salaries are converted to the new entry points with effect from the same date, i.e. July 1, 2018.”

She said the conversion of salaries will be processed automatically through the Integrated Payroll and Personnel Database (IPPD) System. “It is emphasized that the conversions should be verified immediately in order to ensure that any errors are detected and corrective measures taken promptly,” said Prof Kobia's letter.

PUBLIC SECTOR WAGE BILL

Other existing terms and conditions of service will continue to apply, she said.

The pay rise is set to exacerbate the country’s large public sector wage bill, which now stands at nearly Sh630 billion annually—nearly half of the revenues collected.

The public wage bill is 17 per cent above the global average of 35 per cent for middle-income countries, a club that Kenya recently joined after recalculating its economic size.

The April 2017 SRC report, that recommended harmonisation of salaries, revealed that the Sh630 billion is spent on 600,000 public officials who represent less than two per cent of the population.

But worse was the revelation that a mere 3,600 top civil servants, officials and commissioners of various independent commissions earn more than Sh1.6 billion every month.

But in announcing the higher pay, the government is probably betting on faster economic growth to support the increased expenditure.

PENSION SCHEME

In May, Treasury Cabinet Secretary Henry Rotich dampened the mood for civil servants when he announced that 7.5 per cent of their salaries will be deducted for their pension contribution as from October, thus lowering benefits of the pay increase.

The CS told Parliament that the delayed civil service pension scheme will start in October as Kenya struggles to meet rising public servants retirement costs.

Public servants do not contribute to their retirement upkeep, a move that will increase taxpayers’ pension burden to Sh86.2 billion starting this month from Sh15 billion in 2002.

The contributory scheme has been dogged by numerous challenges that have seen its rollout suspended more than five times since its inception in 2009. The scheme will see the government adopt the private sector pension model where contributions from employers and employees are invested in equities, property and government paper to generate returns.