Civil servants will receive a salary increase of between 7 per cent to 10 per cent, with the adjustments retroactively applied from July 1.
The salary increments were announced by Lyn Mengich, the Salaries, and Remuneration Commission (SRC) chairperson, today, Wednesday, August 9.
How Much Money Was Allocated
According to Mengich, the National Treasury allocated a Ksh21.7 billion budget for civil servants for the financial year 2023/24 pursuant to the constitutional principle of affordability and fiscal sustainability.
Who Will Receive the Increments
Among the civil servants affected by the increments are teachers, doctors, nurses, police, military, and officers working under the Executive.
The increments will be done based on the job level and sectors, with the Executive receiving an allocation of Ksh126 million representing 0.6 per cent of the total money for the increments.
State officers in Parliament will be allocated Ksh78 million, which accounts for 0.4 per cent of the total allocation. Their counterparts in the Judiciary will get Ksh305 million representing 1.4 per cent.
On the other hand, county state officers shall get Ksh408 million (1.9 per cent).
Teachers were allocated Ksh9.5 billion (44.2 per cent), and the civil service was given Ksh1.8 billion (8.5 per cent).
The Chair added that the county governments were allocated Ksh4 billion (18.8 per cent), and uniformed and disciplined forces got Ksh4.5 billion (20.9 per cent).
Finally, Mengich revealed that other public officers were allocated Ksh745 million, accounting for 3.4 per cent of the total budget.
How Will the Increments Affect the Wage Bill
The wage bill is projected to rise from Ksh987 billion to around Ksh1 trillion, with the number of employees increasing to around 968 million.
She defended the rise stating that the government will continue to hire civil servants in key sectors of health, education, teaching, and security.
"But we are yet to achieve the desired ratios for teachers to students, healthcare and security to population ratios. Those are the areas we will continue to recruit. However, we must watch the wage bill ratio to revenue and GDP," Mengich explained.
Wage Bill Ratio to GDP and Revenue
While enacting the increments, SRC also assessed the wage bill to Gross Domestic Product ratio and wage bill to revenue ratio.
GDP is the monetary measure of the market value of a country's final goods and services produced in a specific period. Kenya's GDP currently stands at Ksh15 trillion.
In terms of ratio to GDP, SRC uses an average for developing countries which should stand at 7.5%. Kenya, she stated, is currently at 7.4% and is expected to hit 7.19% this year.
"We are on target in comparison to developing countries," Mengich stated.
In terms of wage bill to revenue, Mengich stated that the Public Finance Management Act 2012 stipulates that 35% of revenue should be spent on the wage bill.
"In terms of wage bill to revenue, we are currently at 47.06% in 2022 and projected to hit 40.5% in 2023. This shows that we are moving towards the 35% target.
How SRC Will Lower Wage Bill to Revenue to 35%
Mengich explained that SRC will ensure the GDP and revenue grow faster than the wage bill. As per the current analysis, the wage bill is lagging, which is a positive indicator.
SRC will also review, set and advise on remuneration and benefits within the principle of fiscal sustainability.
The commission already recommended the revocation of four allowances entitled to civil servants. Some of them were retreat allowance, sitting allowance for members of the institutional internal committee, taskforce allowance, and daily subsistence allowance.
Lastly, it will advocate for public service productivity, including advocating for a crackdown on ghost workers and employee appraisals.
