SRC to shut in January if budget cut is effected, warns Mengich
SRC Chairperson Lyn Mengich.
What you need to know:
- In the supplementary budget for the 2023/24 financial year before the National Assembly, the Treasury has proposed a reduction of the SRC budget by Sh61.9 million.
- While appearing before the Labour Committee of the National Assembly, Monday, SRC chairperson, Ms Lyn Mengich, said the proposal is untenable.
The Salaries and Remuneration Commission (SRC) has warned that it will have no choice but to close shop in two months if the government cuts its budget since it will be unable to meet its contractual obligations.
In the supplementary budget for the 2023/24 financial year before the National Assembly, the Treasury has proposed a reduction of the SRC budget by Sh61.9 million. The commission was allocated Sh562.2 million to finance its operations in the current financial year.
While appearing before the Labour Committee of the National Assembly, Monday, SRC chairperson, Ms Lyn Mengich, said the proposal is untenable considering that the commission has done a lot to help the country reduce its wage bill from 51 per cent to 43 per cent of the revenue collected in a year.
This, according to the SRC, has seen the government save at least Sh70 billion a year, which will likely reduce if the proposed cuts that “effectively grounds SRC” see the light of day.
“The proposed budget cuts completely ground the commission. We will not be able to meet our contractual obligations like paying rent, cleaning services among others. Basically we will not be able to function,” Ms Mengich told the committee chaired by Runyenjes MP Erick Muchangi.
The commission is mandated to review the salaries and other perks of State officers. In doing so, it requires adequate budgetary facilitation to enable it to travel far and wide for benchmarking and comparative analysis among others.
Ms Mengich told the committee that the cuts will exacerbate the pending bills menace and also compound the government’s desire to go digital.
“Basically what is being said here is that the commission will not be able to operate from January next year. How do you digitise without a software license whose allocation has been slashed?” posed Ms Mengich.
The areas targeted in the cuts include domestic travel and subsistence, fuel and lubricants, communication, printing, advertising and information supplies, training, office and general supplies, vehicle maintenance, refurbishment of buildings and purchase of office furniture.
But even as Ms Mengich spoke, committee members wondered how the government expects the commission to work and produce world class reports to inform its expenditure plans yet it is not facilitated with foreign travel allowances.
The commission was allocated Sh11.4 million in the current financial year which is expected to be slashed by Sh4.3 million.
But Ms Mengich noted that with an annual fuel requirement of Sh17.3 million, what was allocated is already inadequate and has since affected the commission’s activities.
She revealed that although the commission is required to have two office meetings in a week, commissioners work from home “since they are not fully facilitated to physically work from the office” as required.
The commission also has contracts with service providers for the routine maintenance of office equipment that risks being affected with the proposed cuts.
The cries by the SRC chairperson got the committees’ ears as the chairman and a section of members vowed to defend the commission.
“We want to assure you of our support. We will not wait to see SRC close down. We will argue your case because it is strong,” Mr Muchangi promised the commission.
He added; “I am in agreement with you that if SRC is saving the country Sh70 billion a year and has helped reduce the wage bill, then you do not deserve budget cuts.”
This came as Kangema MP Peter Kihungi wondered whether the government is serious about SRC.
“Is the government still serious with the SRC? As a committee, we should not support this kind of cuts,” said Mr Kihungi.
The Public Finance Management (PFM) Act states that expenditures on wage bills in government should not exceed 35 per cent of the revenue generated annually.
To achieve this target, Ms Mengich revealed that the commission needs adequate facilitation to reduce the government’s huge recurrent expenditures.
The committee will now be required to prepare a report that will be presented to the Budget and Appropriations Committee that will recommend to the House on areas of budget cuts and adjustments.
