Why Kenya's national wage bill is high

The government is committed to reducing the National wage bill to 35 per cent by 2028, Salaries and Remuneration Commission (SRC) Chairperson Lyn Mengich has said.

Currently, 47 per cent of Kenya's revenue goes to the National wage bill.

Mengich said there will be a National Wage Bill Conference at the Bomas of Kenya from April 15 to 17, which will bring on board various stakeholders, who will provide solutions on how the 35 per cent timeline can be achieved, in line with the Public Finance Management (PFM) Act, 2012.

The chairperson, during an interview on Spice FM on Tuesday, April 2, cited productivity as one of the major challenges that has led to the high wage bill.

"If we are productive as a nation, then we would not have this challenge. For example, productivity at the county level means increasing our own source revenue, so that there is less reliance on the shareable revenue from the national government,” she explained. 

“But what we see today is that there are very few counties that are generating more on source revenue, very few are hitting their targets, which means productivity is low.” 

Additionally, Mengich said the duplication of roles had also inflated the wage bill.

Retirement Age

On the retirement age for civil servants, the SRC Chairperson said the reduction of the age from 60 to 55 would only increase the population under pension.

“What is the benefit of reducing the retirement age when you have a productive workforce and you make them pensioners and dependent on everybody? Is it the right thing to do? Do we want to incur a pension liability? It is already huge…These Kenyans are still productive hence should not be retired early,” she said.

Parliament is considering reducing the mandatory retirement age of public servants, including teachers, from the current 60 years to 55 to give young people an opportunity to be employed in public service in Kenya.