County cash woes expose employees’ poor money skills

Taita Taveta County workers
Taita Taveta County workers protest delayed July salaries on Wednesday this week. PHOTO | LUCY MKANYIKA | NMG 

Landing a job in the counties has always been considered a safe bet due to its permanent and pensionable contract terms.

But last week’s happenings have exposed the unpreparedness of most workers on matters finance after a weeklong delay in release of their salaries saw some families skip meals. Currently, some workers are grounded, unable to pay fares to their workstations.

Despite enjoying access to monthly salaries, employees on permanent terms appear to be bad managers of their salaries — the lifeline of their livelihoods.

Financial experts say that each working person should maintain enough savings to enable them maintain the same lifestyle for at least six months after losing a job. But present evidence says otherwise. Most formal employees lack ‘survival’ skills’.

Among savings products being marketed include mobile-based bonds platform M-Akiba that starts from as low as Sh3,000, with the government promising a 10 per cent interest rate payment made biannually.


Others are securities, insurance policies and fixed savings.

“While many Kenyans enjoyed super lifestyles during their working life, they lead hopeless lives that hardly reflect the lucrative careers they formerly enjoyed. We need innovative products that compel Kenyans to save more or else risk placing a heavier burden on the State to provide stipends and fund treatment of its poor senior citizens,” says Association of Pension Scheme Administrators of Kenya chairman Hosea Kili.

In a push for their pay, unions representing various workers in county governments issued seven-day strike notices, describing salaries as a human right that ought not be subjected to political turf wars between the Senate and the National Assembly.

"Workers are citizens of this country who must be allowed to enjoy their hard-earned salaries and that can only be enjoyed when paid in a timely manner," Kenya Local Government Workers Union Secretary General Roba Duba said.

Staff in cadres perceived to be higher, such as doctors and nurses, also voiced their concern, saying no one should hold their lives to ransom by withholding salaries.

Kenya Medical Practitioners and Dentists Union Secretary-General Ouma Oluga said all county health workers would down their tools if the pay delay persists.

Dr Oluga said a dispute over division of revenue is not an excuse to delay salaries as county governments could ask the Treasury for money to pay salaries.

Kenya National Union of Teachers (Knut) is also on the warpath after some teachers reported that their salaries had been sliced, which adversely affected their ability to meet monthly commitments from paying loans and school fees for their children.

The Teachers Service Commission (TSC) stopped the pay raise of 103,624 teachers who are Knut members, saying the court ordered that the terms for unionisable teachers be based on career progression guidelines and not on schemes of service.

Last month’s ruling by the Labour Court effectively stopped implementation of a Sh13 billion salary raise at the end of last month after it halted further implementation of the collective bargaining agreement.

Teachers protested the move and have vowed to down tools come September when schools open for the Third Term to coerce the TSC to rescind its decision and effect payments as promised.

Before his unceremonious exit, then Treasury Cabinet Secretary Henry Rotich rejected a request to have contract workers contribute for their retirement via statutory deductions.

The Retirement Benefits Authority (RBA) wanted employers compelled by law to deduct the contributions for onward submission to privately managed pension schemes and to the National Social Security Fund.

The RBA’s request to Treasury was informed by an emerging trend where employers hire on contract basis to reduce its vote spent on chipping in towards making equal contributions to an individual employee’s pension contributions.

It is this scenario on over reliance on salaries that pension scheme administrators fear is destroying Kenyans’ discipline in managing funds prudently, leaving them exposed to poverty in their old age.