SAVE SH100 BILLION

Party's over: Civil servants to lose hefty perks

SRC to reduce 240 allowances being paid to civil servants to 10 clusters

In Summary

• Responsibility, entertainment, non-practicing, quarter per diem, retreat allowances among those targeted in policy change.

• SRC has invited public views on the new policy which it projects would come into force by end of June this year.

Civil servants face hefty allowance cuts targeting an array of monthly perks to save taxpayers as much as Sh100 billion a year.

The Salaries and Remuneration Commission has proposed at least seven forms of allowances as part of the state's plan to reduce the ballooning wage bill.

Some of the perks set to go include the popular per diem when they work outside their stations and transport allowances.

Others are the responsibility and entertainment allowances for top senior civil servants as well as security allowances enjoyed by a select group of employees.

The lucrative medical allowances paid to civil servants will go as will the non-practising allowances.

The move by the SRC could shrink the payslips of a majority of the civil servants as the state seeks to reduce the skyrocketing public sector wage bill of Sh820 billion a year.

Public input and an SRC circular are all that's needed as SRC is an independent body. No Cabinet or parliamentary approval.

The cost-cutting is expected to trigger an uproar from civil servants after unionists warned they will resist any plan adversely affecting their members.

"The SRC cannot just wake up and say the public sector is abolishing this or that allowance," protested Roba Duba, secretary general of the Kenya County Government Workers Union.

He went on, "Who are you referring to? Public sector from the lower level to the middle class?or the super guys up there? Or those in the labour movement?"

SRC has said there is no objective criterion to determine the cadres of staff whose duties require them to provide hospitality or entertainment.

“Entertainment facilitation shall be provided by the public sector organisation to eligible staff as part of O&M budget and shall be accounted for as per the Public Finance Management Act. 2012,” the policy reads.

The Lyn Mengich-led SRC seeks to finalise the new allowance policy before June 30, after which public institutions will be given six months to implement it.

Public sector employees will no longer have the luxury of hiring taxis as institutions will be expected to make transport arrangements for officers on official duty.

“Where such transport is not available public officers may use public transport and claim reimbursement,” the policy reads.

For those who use their own vehicles, the rates payable and the reimbursable vehicle capacity will be advised by the SRC, factoring in the government’s transport policy.

Also expected to go is quarter per diem, which is an allowance of as much as a quarter of daily subsistence where an officer’s foreign travel and accommodation expenses are fully covered by the government.

“SRC shall issue guidelines on the quarter per diem for foreign travel,” the policy reads. Public officers will also not lay claim for expenses not catered to in privately sponsored trips.

SRC is also reviewing designated hardship areas, citing the impact of devolution and the Equalisation Fund.

Non-practising allowance – for judges and health workers – is deemed to have outlived its purpose. The SRC is calling on professionals in the public service to render services with their undivided attention.

The public sector wage bill is projected to be reduced by about Sh100 billion annually if the proposal is adopted and wholly taken up by the government.

Salaries for the more than  865,200 state and public officers went past Sh820 billion in the 2019-20 financial year — of which allowances amounted to Sh322 billion.

The wage bill was Sh434 billion as of June 2013 and shot up to Sh526 billion in the year to June 2014. It rose to Sh558 billion, Sh614 billion, Sh663 billion, Sh733 billion, Sh795 billion in the successive years.

Controller of Budget Margaret Nyakang’o flagged the bloated public service in her latest review of the national government budget for the half year of 2020-21.

In minimising disparities in gross remuneration packages, SRC says its ultimate aim is to cap allowances at 40 per cent of basic pay.

Mengich said every public sector worker will be affected by the proposed allowance cuts, while new employees will be affected where an allowance is being abolished.

For retreat allowances, SRC argues that the payment amounts to double compensation as “public officers are paid a salary to discharge their full responsibilities.”

The commission said “government work is increasingly being delivered through retreats, defeating the purpose for which the allowance was set up.”

It holds that retreat allowance was meant to compensate highly skilled public officers for developing policy documents, by providing an environment for brainstorming.

“Some public service institutions pay the allowance for any assignment undertaken in a retreat even when no policy document is being prepared,” the SRC said.

Where transport is not available, public officers may use public transport and claim reimbursement.
Draft SRC Allowances and Benefits policy

For medical allowance, public service institutions shall be required to procure a comprehensive medical insurance cover – the limit to be set by the SRC, or provide an in-house medical facility for its staff.

“All allowances — outpatient, outpatient medical, optical, dental, and inpatient — that are related to medical allowance are abolished,” the policy reads.

For responsibility allowance, SRC intends to convert the perks to extraneous allowances or social responsibility allowance – for eligible persons.

However, the allowance will be paid at existing rates until the next job evaluation cycle, while drivers who get it currently will have their perks converted to extraneous allowance.

Electricity, water and watchmen's bills — paid to various accounting officers and senior management of state corporations and public universities — will no longer be paid by state.

The SRC argues that the utilities are personal expenses that ought to be catered for from one’s salary, pointing out that some are paid for in personal residences, others against the law.

Going forward, utilities in official residences shall be paid through the operations and maintenance budget while those for private residences will be abolished.

Related allowances such as gardeners, service, amenities, staff water, electricity concession, furniture and domestic servant allowances are set to be abolished.

Extra perks for security, as paid to specified senior management employees to facilitate provision of security at their residences — where official security is not provided — will also be slashed.

The SRC says that going forward, security shall be provided as a benefit and not an allowance and the same will be assessed and advised by the Inspector General of Police.

The ‘owner-occupier house allowance’ paid to officers who live in their own houses to cater for house allowance is marked for abolition.

Allowances paid for similar purposes will be merged and renamed while those whose rates are not commensurate with their  purpose will be restructured. Those whose form doesn’t change will be retained.

Civil servants in Job Group T and above shall not be paid allowances on appointment to a task force, the same for those 'earning' extraneous allowances.

Resource persons allowances will not be paid to public officers making presentations in their own institutions, and will only be payable to persons from the private sector.

For sitting allowances, MPs will be required to enact laws capping the frequency and number of meetings by boards of state corporations, tribunals and committees.

Annual leave allowance — to cover an officer’s travel cost in case one takes at least half of the annual provision— will be standardised across the public service.

“The leave allowance currently provided for in an existing CBA shall continue to be paid until the end of the CBA cycle. All new CBAs shall adopt the provisions on leave allowance herein,” the policy reads.

For restructuring, administration extraneous — for weekends and holidays tasks, animal handlers for care of horses and dogs; extra hours for working beyond the set 46.5 hours for clinical officers and pharmacists and late duty allowances  for staff except heads of department — will be harmonised under extraneous allowance.

Allowances such as bandsman — for officially sponsored activities, firearms handling — for security to senior county staff, headship for heading a department, coordination and management support allowances will be renamed special responsibility allowance.

Accommodation, night, night out, out of station, per diem and maintenance allowances – paid to officers on local travel or overnight stay away from work stations— will be paid as daily subsistence allowance.

Mileage and motor vehicle allowances — paid to officers to compensate for use of their personal vehicles— will now be paid out as transport claims.

Communication facilitation will cater for airtime, mobile, and telephone allowances.

(Edited by V. Graham)