Mandate of the Commission
The Salaries and Remuneration Commission is one of the independent Commissions established by The Constitution of Kenya 2010; under Article 230 with the mandate to:
- Set and regularly review the remuneration and benefits of all state officers; and
- Advise the National and County Governments on the remuneration and benefits of all other public officers.
In performing its functions, the Commission shall take the following principles into account:-
- The need to ensure that the total public compensation bill is fiscally sustainable;
- The need to ensure that public services are able to attract and retain the skills required to execute their functions;
- The need to recognize productivity and performance; and
- Transparency and fairness.
Functions of the Commission
- Inquire into and advise on the salaries and remuneration to be paid out of public funds;
- Keep under review all matters relating to the salaries and remuneration of Public Officers;
- Advise the national and county governments on the harmonization, equity and fairness of remuneration for the attraction and retention of requisite skills in the public sector;
- Conduct comparative surveys on the labour markets and trends in remuneration to determine the monetary worth of the jobs of Public Officers;
- Determine the cycle of salaries and remuneration review upon which Parliament may allocate adequate funds for implementation;
- Make recommendations on matters relating to the salary and remuneration of a particular State or Public Officer;
- Make recommendations on the review of pensions payable to holders of Public Offices; and
- Perform such other functions as may be provided by the Constitution or any other written law.
Membership of the Commission
The Commissioners are appointed by nomination from the following bodies, Parliamentary Service Commission, Judicial Service Commission, Senate on behalf of the county Government and the Defence Council. The other members include one person each nominated by an umbrella body representing trade unions; an umbrella body representing employers; and a joint forum of professional bodies as provided by legislation. In addition one person each nominated by the Cabinet Secretary responsible for finance; the Attorney-General; and one person who has experience in the management of human resources in the public service, nominated by the Cabinet Secretary responsible for public service.
As a Constitutional Commission the Salaries and Remuneration Commission (SRC) has the objects and authority as provided under Article 249 of the Constitution of Kenya 2010, namely to:-
- Protect the sovereignty of the people
- Secure the observance by all State organs of the democratic values and principles; and
- Promote constitutionalism.
In carrying out its functions, the Constitution provides under Article 249 (2) that the Commission is:
- Subject only to the constitution and the law; and
- Independent and not subject to the direction or control by any person or authority
The Salaries and Remuneration Commission is a part-time Commission is keen to embed the principle of equal remuneration to persons for work of equal value.
Economics of Remuneration
The Salaries and Remuneration Commission was constituted at a time when Kenya’s economy is experiencing continued recovery from the economic downturn encountered in 2008 when the Country recorded a low GDP growth rate of 1.5 percent down from 7.0 percent in 2007. The GDP growth picked up from 2009, reaching 4.4 percent in 2011 with growth projected at over 5.6 percent for 2012.
The Constitution also compels that the Salaries and Remuneration Commission in setting, reviewing or advising on remuneration and benefits ensures productivity and performance for improving the living standards of Kenyans. The population growth rate is currently relatively high, contributing to a contraction in per capita incomes. Real per capital (adjusted for inflation) incomes grew by about 5 per cent between 2006 and 2010 when it stood at Kshs 63,419 in 2010, the capita GDP at constant and market prices were Kshs. 38,970 and Kshs 76,577, respectively. This translates to constant prices earning of about Kshs 3,248 per month, which is too low given prevailing inflation rate of 14.5 per cent. The proportion of poor people is estimated to have increased to 48.8 percent in 2011 (IPPRA, 2012) up from 45.9 percent recorded in 2005/06.
Another challenge facing the country which remuneration levels of public servants impacts on is the low creation of quality jobs relative to the growth in the labour force, leading to unemployment and underemployment; high employment in the informal sector compared to the formal sector, and wage gaps. Currently, the share of informal sector employment is close to 81 per cent between2004 and 2011. The share of normal (wage) sector (both public and private combined) employment has remained about 19 percent. The level of remuneration set by the Salaries and Remuneration Commission will determine the cost of employment, the expansion and establishment of industries and therefore, the employment creation rates.
The score of labour global standard of percentage available man hours used for productive work in Kenya is at 35 percent whole global standard is at 75 percent. These are pointers that workers have not been able to change from the way they are doing things over time, public service not exempted. The Salaries and Remuneration Commission in consultation with stakeholders would therefore, need to adopt and implement interactive productivity linked to pay across the Public Service and thus economy so that parity and equity in remuneration and benefits structure is realized. This is because for the economy to grow and the country to achieve the aspirations in the Vision 2030 of a middle level economy, it will be impossible for any employer to pay more wages if productivity and performance is not enhanced.
Public-Private Sector Wage Levels
Figure 1.1 below shows the trends in public and private sector wages. Until 2008, the average annual earnings were higher in the private sector than in the public sector. Since then, the trend has reversed in favour of public sector and the gap is even getting wider. In 2011, the average annual wage earning per employee in the public sector (Kshs 427,991) was higher than that for private sector (Kshs 405,959). This has mainly been influenced by the wages set in some State Corporations and the Constitutional commissions.