Government increases salaries and backdates July.
Government increases salaries and backdates July.
Civil personnel will receive a wage raise ranging from 7% to 10%, with the modifications taking effect on July 1. Lyn Mengich, the head of the Salaries and Remuneration Commission (SRC), announced the compensation increases today, Wednesday, August 9.
How Much Money Was Allotted? According to Mengich, the National Treasury has allocated a Ksh21.7 billion budget for civil servants for the fiscal year 2023–24 in accordance with the constitutional principles of affordability and fiscal sustainability.
Who Will Get the Increases? Teachers, doctors, nurses, police, military, and executive branch employees are among those affected by the raises.
The increments will be distributed depending on employment level and sector, with the Executive receiving Ksh126 million, or 0.6% of the total money for the increments. State officers in Parliament will receive Ksh78 million, accounting for 0.4% of the overall allocation.
Their peers in the Judiciary will receive Ksh305 million, or 1.4% County state officers, on the other hand, will receive Ksh408 million (1.9%). Teachers received Ksh9.5 billion (44.2%), while the civil service received Ksh1.8 billion (8.5%).
The Chair further stated that county governments received Ksh4 billion (18.8%), while uniformed and disciplined forces received Ksh4.5 billion (20.9%). Finally, Mengich disclosed that Ksh745 million was allotted to other public officers, accounting for 3.4% of the overall budget. What Impact Will the Increments Have on the Wage Bill?
The salary cost is expected to rise from Ksh987 billion to about Ksh1 trillion, with an increase in the number of employees to around 968 million.
She defended the increase, claiming that the government will continue to hire civil servants in critical sectors such as health, education, teaching, and security. “However, we have yet to achieve the desired teacher-to-student ratios, healthcare-to-population ratios, and security-to-population ratios.” These are the positions for which we will continue to recruit. “However, we must keep an eye on the wage bill to revenue and GDP ratio,” Mengich explained.
While enacting the increments, SRC also assessed the wage bill to Gross Domestic Product ratio and the 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.
SRC considered the wage bill to GDP ratio and the wage bill to revenue ratio while enacting the increases. GDP is a monetary measure of a country’s final products and services produced in a given period. Kenya’s GDP is currently Ksh15 trillion. In terms of GDP ratio, SRC utilizes the average for developing nations, which should be 7.5%. She noted that Kenya is currently at 7.4% and is likely to reach 7.19% this year.
“We are on target in comparison to developing countries,” Mengich said. In terms of wage bill to revenue, Mengich remarked that the Public Finance Management Act of 2012 requires that 35% of revenue be spent on wages. “We are currently at 47.06% wage bill to revenue in 2022 and are projected to reach 40.5% in 2023.” This indicates that we are approaching the 35% target.
