SRC’s move to tame wages means it must build alliances with organised citizen groups

Tuesday August 8 2017

Salaries and Remuneration Commission Chairperson Sarah Serem

Salaries and Remuneration Commission head Sarah Serem addresses journalists at Winsor Hotel in Nairobi on March 17, 2017. PHOTO | EVANS HABIL | NATION MEDIA GROUP 

By JASON LAKIN
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In my last column, I discussed important shifts at the Commission on Revenue Allocation and promised to do the same for the Salaries and Remuneration Commission (SRC).

I have previously decried the SRC’s performance. It has in the past been slow and timid. But its recent gazette notice deserves plaudits.

What did this notice actually do? One of the big unknowns (and in this sense the notice was very late) was what would happen to salaries for state officers after the August elections.

The main notice clarifying salaries for these officers in 2013 did not have anything to say about what would happen after the next elections. As I have noted previously, government therefore went through the entire 2017-18 budget preparation and approval cycle without this information. Not good.

Nevertheless, the SRC has finally addressed this matter, and made some important changes. First, the salaries for state officers as of August 1 this year have been pegged to the third year figures from the last cycle. In other words, officers in 2017/18 will earn what these same officers earned in 2015/16.

As an example, the salary for the president in 2017/18 will be Ksh 1.44 million per month. This was the president’s salary in 2015/16.

In 2016/17, the president’s salary was Ksh 1.55 million per month. So his salary has been reduced by about seven per cent at a time when annual average inflation is running at close to eight per cent.

Put another way, if the president’s 2017/18 salary was to be worth the same amount this year as it was in 2016/17, it would have grown from Ksh 1.55 million per month to about Ksh 1.67 million, but instead it is falling to Ksh 1.44 million. That is a substantial real decline.

More important still, the SRC has eliminated annual increments, so that salary will remain in place for the next five years. To put this in perspective, the president’s salary under the old gazette would have grown by a total of about Ksh5 million over a five-year period. That increment has been eliminated.

The comparable increment for governors was just over Ksh3 million (which, times 47, would have been Ksh 149 million). That has also been eliminated. The same is true for all other state officers, though the amounts would be lower in most cases. The elimination of these increments also reduces the gratuities for these officers when they leave, since this is calculated as 31 per cent of their base pay.

The shift to zoned transport allowance is welcome, as it will reduce the shenanigans that happen around verifying reimbursement claims and put a cap on them, though it is not clear exactly how much this will reduce spending.

It appears that the minimum payment per parliamentarian will be more than Ksh267,000 a month, or Ksh3.2 million a year. With more than 400 parliamentarians, this means a minimum in excess of Ksh1.3 billion a year for transport alone, regardless of whether they actually travel.

While the decision to cap salaries and transport are bold moves, they are not bold enough to fully address bloated public sector pay or free up resources for more pressing matters. Little has been done to reduce or eliminate other allowances.

Subsidised car loans and mortgages are still on offer for state officers, along with hefty insurance perks. The chair of a county assembly committee (and in many counties, most members are chairs) can still earn nearly Ksh1 million per year just for showing up for committee meetings. Parliamentary chairs can earn Ksh1.5 million per year.

Nevertheless, if SRC can hold the line on wages for the next five years at the figures it has proposed, this will be a significant step forward. Of course, we have seen in the past that SRC’s efforts to draw a line in the sand have been scuttled.

There will be enormous pressure from incoming politicians to reverse these shifts. When this pressure comes, who will defend the public interest?

The public has voiced its discontent before with the way parliamentarians have manipulated SRC. This led to the famous “MPigs” protest of 2013. While the protest garnered considerable media attention, it did not stop parliamentarians from pressuring SRC to negotiate and it damaged relations between civil society and legislators for several years.

Perhaps Boniface Mwangi will be in Parliament this time around, rather than on the streets. Perhaps that will make a difference.

But the rather unfortunate recent history of independent commissions has been that they have built weak links with citizens and found themselves without sustained backing when politicians came brandishing their carving knives. SRC would do well to start building alliances with organised citizen groups now, before there is more blood in the streets.

Jason Lakin is head of research for the International Budget Partnership. E-mail: [email protected]