The move to rid parastatals and government agencies of ghost workers should be expedited to save taxpayers their hard earned money.
The removal of more than 12,500 ghost workers from the government payroll 12 months ago testifies that billions of taxpayers’ funds could still be going to waste in parastatals and government agencies.
The high wage bill has ensured that the government can only spend 30 per cent of its budget on development, making it unable to grow faster and generate more taxes.
The nearly 200 government-owned entities, including regulatory agencies, public universities and research institutions, should be thoroughly audited to remove the names of those who are either deceased, retired or have deserted duties.
The results achieved by the exercise should not be lost by an outdated personnel systems management, the government must improve its systems to make it easier to identify and get rid of non-existent personnel and prevent the recurrence of the irregularities.
If the wage bill was contained, the government would not need to borrow so much in the domestic market pushing out the ordinary borrowers.
The Treasury in the preceding weeks has been borrowing money here and there at exorbitant costs to maintain basic operations, pushing up interest rates. The dire situation left counties and other government agencies starved of cash making them to suspend some services.
That an economy can grow by five per cent and still leave the Treasury with no cash flow as seen in the recent cash crunch tells you that the money being generated is ending up in the wrong places, which includes an oversized wage bill, heavy debt repayment and theft.
The government therefore needs to arrest this cycle by directing expenditure to the right places to sustain the current economic growth trend or else even the five per cent growth rate will disappear.
The government also needs to review its policy on pay given that civil servants are now earning better than their private sector counterparts. It is worrying that a government well aware of the perils of running a huge bill is waiting to be pushed by the International Monetary Fund (IMF) to cut its wage bill.
Kenya’s total public sector wage bill is estimated at Sh568 billion or 11 per cent of the gross domestic product (GDP), which is more than the global best practice of seven per cent.
At Sh568 billion, the public wage bill also stands at more than 50 per cent of total revenues against a globally recommended threshold of not more than 35 per cent.
SOURCE: BUSINESS DAILY