Ruto targets 12 high-earning parastatal chiefs for pay cut

Wednesday, August 30th, 2023 00:30 | By
President William Ruto
President William Ruto. PHOTO/@HonMoses_Kuria/X

President William Ruto has now trained his guns on chief executives and employees of at least 12 top notch state corporations who have been going home with hefty perks as the government moves to harmonise salaries of all civil servants and state officers.

Some of the chief executives of the state corporations classified as “Class A” are said to earn more than the President himself, making them an envy of heads and employees of other parastatals ranked in Classes B and C.

While the President takes home a monthly gross pay of Sh1.4 million, exclusive of several allowances that come with his office, chief executives in several of the so called blue-chip parastatals are said to enjoy high perks ranging from Sh2 million besides other emoluments.

Early this month, the President triggered the debate when he questioned the criteria used to pay some of the heads of state corporations, noting that some earn even more than himself.

 “We have discovered that there are people in parastatals and other institutions who earn more than what the President gets. Which jobs are they possibly doing that warrants them to allocate themselves such salaries?” Ruto said while addressing the recently concluded Devolution Conference in Eldoret. 

While expressing concern that some officials in certain parastatals have assigned themselves huge salaries at the expense of taxpayers, the President disclosed that he has already contacted the Salaries and Remuneration Commission (SRC) over the huge disparity between salaries earned by civil servants and state officers in certain government agencies.

“We need to discuss how some fellows in parastatals earn more than the President. It is a conversation that I have already begun with SRC,”the President said.

Harmonise salaries

 The President said it would no longer be “business as usual as the country will not lose revenue while civil servants cannot deliver services because a few people decided to go away with public money.”

This was after the President and his Deputy Rigathi Gachagua had turned down an SRC proposal to increase their salaries alongside other civil servants and state officers.

Consequently, SRC has embarked on an exercise to harmonise salaries within all government agencies in an exercise that could see salaries of the top earners being cut down by almost a half.

Sources told the People Daily that some of the government agencies in President Ruto’s crosshairs include Central Bank of Kenya (CBK), National Intelligence Service (NSIS), KenGen, Kenya Power, National Social Security Fund (NSSF), National Hospital Insurance Fund (NHIF), Capital Markets Authority (CMA), Ethics and Anti-Corruption Commission (EACC), Kenya Airports Authority (KAA), Kenya Civil Aviation Authority (KCAA), Communications Authority of Kenya (CA), Kenya Revenue Authority (KRA), Kenya Ports Authority (KPA), Kenya Pipeline Company (KPC) and Kenya Airways.

Sources cited KCAA where a person on internship goes home with Sh120,000 while an air traffic controller earns Sh1 million per month.  Aeronautical information specialists and data officers at KCAA go home with Sh2 million.

Chief executives at KCAA, CBK, CMA, CA, KPA, KQ and KRA are said to be going home with salaries ranging between Sh2.2 million and Sh3 million each month, besides the accompanying allowances.

Yesterday, SRC said it was aware of the concerns over the hefty salaries and allowances paid to some staff in certain parastatals classified as ‘Class A’, SRC and that it has taken measures to address them.

The People Daily had also sought to know whether salaries and allowances in these so-called blue chip parastatals are formulated by the salaries commission and what formula is used to determine them.

 “In 2019, SRC undertook a ‘Study on Allowances Payable in the Public Service’, to establish the gross pay as a basis for harmonisation to achieve equity and fairness. As a result, SRC commenced on a process to progressively harmonise remuneration across the public service,

 “Thus, SRC is aware of the concerns and has already taken measures to progressively address them,” reads the response.

 “The review and harmonisation of remuneration and benefits in the public service is a continuous and progressive process. SRC adheres to the principles of ensuring equity and fairness in remuneration through progressive harmonisation of remuneration and benefits in the public service,  “This was evidenced in the just-concluded third remuneration and benefits review cycle, where deliberate measures were undertaken to progressively harmonise by freezing of remuneration for institutions whose gross remuneration are above the 50th percentile gross market positioning,” reads the response.

 It points out that public institutions that are below the 50th percentile gross market positioning were prioritised within the framework of affordability and fiscal sustainability.

Historical disparities

On whether President Ruto has officially communicated to SRC about the concerns he had voiced, SRC said it is guided by principles set out in Article 230(5) of the Constitution and Section 12 of SRC Act, 2011.

 “Further, SRC undertakes stakeholder engagements and takes into account feedback from stakeholders, including the President. Stakeholder engagements on streamlining of allowances paid in the public service is ongoing.”

 “SRC continues to review, set and advise on remuneration and benefits to address historical disparities in the public service. Under the third remuneration and benefits review cycle, the theme has been on the progressive harmonisation of remuneration,” it states.

 The President had stated: “Whatever office one occupies, whatever friends one may have, it will not be business as usual as no one will be given a chance.”

 An insider explained that ‘Class A’ parastatals in Kenya are institutions which play a significant role in the country. They, therefore, pay the best salaries among state corporations in the country.

  “If you manage to join any of these state corporations, you will earn starting salary of not less than Sh130,000, that is when you possess a university degree,” confided the source.

 In these institutions, front office staff earn more than bank cashiers. A junior secretary pockets not less than Sh50,000 while a driver pockets at least Sh60,000. Some of these parastatals also benefit from annual bonuses, especially NSE and Kenya Airways. Besides bonuses and salaries, they also have numerous trips abroad. If by any chance you manage to have a 20-day foreign trip in a single year,that is more than Sh600,000.

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