Uhuru Kenyatta said on Tuesday that Kenya’s high public sector wage bill is one of the biggest threats to the east African nation’s economy, threatening to “destroy [the] development agenda”.
“Today, the public wage bill stands at 627 billion shillings per year [$6bn],” he said. “This staggering amount is used to pay the salaries and allowances of 700,000 public officers including those of us here today.
“In simple terms, 50% of all the money collected as revenues in Kenya goes in to the pockets of less than 2% of the country’s total population.”
A 2016 study by the International Monetary Fund agreed that the size of Kenya’s wage bill reflects high wages rather than high employment.
On average, public wages exceed those in the private sector by around 20%, the fund said, and civil servants enjoy a number of other benefits, such allowances for housing or transport.
Some civil servants in the country recently got a further wage boost as the Salaries and Remuneration Commission (SRC) harmonised pay grades across the public sector, in a bid to close a substantial gulf between the highest and lowest paid.
A further $1bn was also made available in the 2017-18 budget after doctors and teachers went on strike to pressure the government to honour salary increases contained in collective bargaining agreements.
Kenyatta said workers staging “incessant strikes” and “go-slows” and outright neglecting their duties were fuelling the “spiralling wage bill”.
“Some unions have put pressure on the government to further increase the wage bill to unsustainable levels without the constitutional and mandatory input from the SRC,” he said.
“These are issues that need to be resolved soberly because we are fast approaching breaking point.”
The SRC has delivered a report to the president, not yet public, reviewing remuneration and benefits for the civil service for 2017-22.
Kenyatta said the commission’s recommendations will result in a reduction in salaries and allowances for elected officials who take office after August of this year.
“These recommendations will allow us to pay more attention to our medical professionals, our teachers, our policemen and all public servants at national and county levels, with a view to improving the terms of those in the lowest cadres.”