President Ruto kept busy fighting fires from one emergency to next

William Ruto

A fresh scandal has rocked Kemsa, counties are broke, civil servants want to strike and the cost of living is through the roof.

Photo credit: Nation Media Group

As President William Ruto took the oath of office in front of a packed and expectant crowd at the Kasarani stadium, he vowed to do things differently from the previous regime, in which he had also served as Deputy President.

He started by overturning some of his predecessor's edicts. Six judges blocked by his predecessor, Mr Uhuru Kenyatta, were appointed, police were given an independent budget and cheap fertiliser was made available to farmers.

Eight months on, however, the nascent administration is facing a myriad of challenges that threaten to throw the government into turmoil.

A multibillion-shilling scandal has rocked the Kenya Medical Supplies Authority (Kemsa), counties are broke, civil servants are threatening to go on strike and the cost of living is through the roof. Compounding the situation are controversial taxes and levies that are likely to make life more difficult for the majority of struggling Kenyans. 

In addition, the Kenya Kwanza government is facing an Opposition that has refused to accept defeat and maintains that the administration is illegitimate.

After riding out weeks of anti-government protests, the Head of State is in the eye of another storm as he grapples with the fresh Kemsa scandal.

The scandal-plagued state-owned company botched a Sh3.7 billion tender for the supply of treated bed nets to help millions of low-income households prevent malaria.

The latest saga has cost the government at least Sh370 million in foregone revenue and a tarnished global image. Dr Ruto has moved quickly to clean up the mess. Public Health Principal Secretary (PS) Josephine Mburu was sent home, along with the entire Kemsa board and its chief executive officer Terry Ramadhani. 

He also revoked the appointment of Kemsa chairman Daniel Rono, just three months after he was appointed, as well as members of the disgraced board.

Opposition leader Raila Odinga described Dr Mburu's sacking as a reactionary response to a significant problem within Kemsa.

"I believe this is not the only scandal in the authority. I expect that we will see more revelations in this government," he said on Monday.

Dr Ruto is facing another nightmare over the high unemployment rate. The promise to reduce the cost of living has not yielded immediate results, with the price of unga still above Sh200 and the prices of other basic commodities remaining high.

In the latest review of petroleum prices for the 15 May to 14 June cycle, the Energy and Petroleum Regulatory Authority (Epra) increased the price of kerosene by Sh15.19 per litre to Sh161.13 in Nairobi after the government removed subsidies on diesel and kerosene.

The situation could worsen from July if Parliament approves a proposal in the controversial Finance Bill, 2023 to reintroduce 16 per cent VAT on petroleum products, up from eight per cent. 

The President has also backtracked on his promise of cheaper cooking gas from next month.

President Ruto also faces another headache in the form of a controversial three per cent housing levy, which he says is mandatory.

The plan is also contained in the Finance Bill 2023, in which the National Treasury has proposed to introduce a mandatory three per cent deduction from workers for the National Housing Development Fund, with employers matching the contribution. In return workers will get either a house or their savings back plus interest.

In February, the government increased deductions to the NSSF from the uniform Sh200 per worker to six per cent of salaries, with many now paying Sh1,080.

Last month, President Ruto also proposed increasing workers' National Health Insurance Fund (NHIF) deductions to 2.7 per cent of the basic salary. 

The housing levy has been heavily criticised. The Federation of Kenya Employers (FKE) warned that thousands of Kenyans could lose their jobs. FKE executive director Jacqueline Mugo said the proposal was unsustainable as most employers were struggling with the high cost of doing business.

But Kenya Kwanza MPs have defended the President, saying, the challenges facing his administration are not of his own making. 

Nandi Senator Samson Cherargei said the Kenya Kwanza administration is on the right track as President Ruto inherited a dilapidated economy and other political challenges that threatened to cripple the country.

He described Dr Ruto's swift and decisive action on the Kemsa scandal as a sign that unlike in the past, there will be no sacred cows in his administration.

"The President is settling in and we have his first budget to implement his plans on the way. The government is on the right track contrary to the expectations of political detractors and I can assure you that the economy will soon be stabilised," said Mr Cherargei.

He also defended the 2023 Finance Bill, saying it had to be passed to enable the government to deliver and also pay its ballooning debts.

"The government needs revenue and there are only two options. Either we borrow more and accumulate more debt or we increase taxes and make sure it works for all of us," he said.

For Nyaribari Chache MP Zaheer Jhanda, the president's swift response to the Kemsa scandal shows how committed he is to fighting corruption.

"If Uhuru had taken the same steps as Ruto, the people involved in Kemsa would be in jail today," said Jhanda.

"The President is acting swiftly and this is the kind of leader he is showing to Kenyans that under his leadership, not even a coin will be lost and it does not matter where you come from."

On the issue of the cost of living, he said the problem is a global one and not unique to the Kenyan government, but the President is doing all he can to reverse the situation.

"The cost of living issue will take time but we will get there eventually," the UDA MP said.

Roysambu MP Augustine Kamande also came to the president's defence, saying that despite teething problems, the Kenya Kwanza administration was on the right track.

"The high cost of living will come down in August after the harvest as the government has invested in subsidised fertiliser to boost agricultural production," he said.

With the country's public debt nearing the Sh10 trillion mark, President Ruto has found himself in a quandary as he has no room to manoeuvre.

As a result, civil servants have had their March salaries delayed and even lawmakers have been caught up in the cash crunch.

At the county level, the financial squeeze has left most of the devolved units on the verge of total paralysis as they are owed at least Sh94 billion in equitable share of revenue disbursements. 

County governments are yet to receive their February, March and April allocations, leaving workers in the devolved units going without pay for months.

"We've never been here before, I've been a governor for five years and it's really a very critical situation in the counties," said Kirinyaga Governor Anne Waiguru, who also chairs the Council of Governors.

The financial settlement means that counties will only receive Sh385 billion in equitable share allocations for the next financial year, as opposed to the Sh407 billion proposed by the Commission on Revenue Allocation (CRA). President Ruto is facing a looming strike by health workers who have threatened to down their tools over non-payment of salaries and statutory deductions.

"We wish to emphasise that this is not a strike notice, but rather a demonstration of our members' inability to report to work due to lack of resources," a letter from at least five unions reads in part.

The unions said doctors were unable to meet their daily needs, including transport, food and accommodation.

Apart from the medics, the Kenya National Union of Teachers (Knut) is also threatening a strike if the National Assembly approves the three per cent housing levy.

"If the government does not listen to us, we are ready to take legal action or any other action we deem fit to make the government listen to us," said Nairobi Knut Secretary-General Macharia Mugwe.

Dr Ruto's government also faces an implacable Opposition that has declared his administration illegitimate and is demanding that a number of issues be addressed.

The President and Mr Odinga have traded barbs on several occasions over the high cost of living, Opposition-led demonstrations, Kenya's debt burden and proposed taxes in the Finance Bill, 2023.

Mr Odinga has singled out an increase in VAT on maize flour and pharmaceutical products, higher duties on imported cement and the imposition of sales tax on small businesses.

Mr Odinga also cited the income tax adjustment pegged at 35 per cent for those earning Sh500,000 a month, as well as the three per cent deduction from salaries to support the housing fund, 15 per cent tax on digital content creators, taxation of per diems at 30 per cent and tax on beauty products.

The Opposition has urged the National Assembly to reject the "punitive" tax measures, saying, they will increase the cost of living and hurt the economy.

"If this bill is rammed through Parliament, Kenya Kwanza must be prepared that we will have no option but to mobilise citizens across the country to fight for themselves.”

“We will have no option but to mobilise all social sectors and take all necessary political actions to stop this blow and burden," Mr Odinga said on Tuesday.

The President is also under fire for entrenching nepotism in State appointments and hiring people of questionable integrity to public offices.

The alleged tribalism and nepotism in the Commander-in-Chief's appointments has created a storm in the country, with the Church being the first to raise concerns.

Several quarters have come out to condemn the growing trend, with the Anglican Church condemning the creeping tribal and regional appointments in the public service. 

"There is blatant tribalism and nepotism, especially in public appointments," said Anglican Archbishop Jackson Ole Sapit.

"This is not acceptable. Let all government institutions and offices be impartial and not simply beholden to political influence, and serve all Kenyans with impartiality".

Questions have also been raised about “State capture” in the Office of the Director of Public Prosecutions and the Directorate of Criminal Investigations, in light of the mass dismissal of corruption and economic crimes cases brought against politicians allied to the President.