Hello and welcome to the Evening Brief Newsletter where we are anticipating job losses in government following Ruto's 30 per cent directive to CEOs. Also, stick around for our responder text with an economist.
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On the Line
Jobs for Kenyans working in parastatals are on the line after President William Ruto directed their CEOs to effect a 30 per cent reduction in recurrent expenditure.
The Head of State gave the order during a one-on-one meeting with the parastatal heads at the State House on Tuesday, reinforcing the need for fiscal discipline in the use of public funds.
He also stressed that the recurrent budgets of state-owned corporations must undergo a rigorous audit to stamp out corruption and misuse of public resources.
What Ruto Wants: "The time is up for loss-making parastatals and those that make profits must stop wasteful expenditure, including financing largesse in their parent ministries and unnecessary procurement. Now that the economy has stabilised, we cannot continue accumulating debt. Borrowing will only lead us down the cliff."
The Effects: In my interview with Chris Churchill, the economist reinforced that it was difficult for the parastatals to realise the 30 per cent reduction by scaling down on operation and maintenance costs alone.
Either some of the parastatals will grind to a halt or jobs and employee salaries will go under the knife. (Check Our responder text below.)
Ruto's Solution: To prevent casualties, the Head of State advised the parastatal CEOs to leverage technology to find optimum ways of running operations and maximising profits. He warned that the expenses must never exceed the budget set.
Earlier, Ruto had put 11 parastatals up for privatisation including KICC and Kenya Pipeline Company arguing that placing them in private hands is highly likely to make them profitable and ease pressure on the exchequer. The administration intends to privatise up to 35 state companies by December 2024.
“In three years, we must run a balanced budget. It won’t be easy but we must do it,” he explained.
Technical Terms: Recurrent budget means resources set aside for ongoing expenditures such as; salaries, operations, and maintenance cost of capital assets.
Firing Over Whatsapp Message
Unrelated, an employee at Isiolo County Government was fired after being accused of writing WhatsApp text messages considered disparaging by the administration.
In the termination letter, the employee was relieved of his communication officer duties and kicked off the Governor’s Delivery Unit.
“As a public officer, it is imperative that you maintain professionalism and refrain from engaging in activities that undermine the reputation and integrity of our organisation and its officials,” the government concluded.
Chat With An Economist
After President William Ruto ordered parastatals to reduce their recurrent expenditures, I reached out to an economist to put the figure into perspective.
Chris Churchill told me that jobs were highly likely on the line or employees may be forced to endure pay cuts or see their allowances taken away altogether.
Here is the chat;
Derrick Okubasu: President William Ruto has directed CEOs of parastatals to cut recurrent expenditures by 30 per cent? What are the effects of the directive?
Churchill: The execution risks of implementing the slash in expenditure spending boils down to where exactly the slash will happen. Is it the operations and maintenance (of the parastatals)? This may not yield 30 per cent slash in overall parastatal recurrent spending unless things just crawl to a halt.
I am seeing little wiggle room on how the parastatals will be able to implement that 30% spending cut.
Derrick: Will people's jobs be affected?
Churchill: Jobs are likely to be lost and if not, the parastatals may now either implement job cuts or reduce the allowances in the public sector forcing people to survive on basic pay.
Jobs Up for Grabs
As parastatals contemplate letting people go, other arms of government are looking to fill jobs.
The Ethics and Anti-Corruption Commission (EACC) has announced that it is looking to fill 23 positions cutting across investigation officers, legal officers ICT department down to drivers and security assistants.
"Interested candidates should complete EACC Form 1 online from https://jobs.integrity.go.ke and attach copies of ID, CV, academic/ professional certificates and testimonials. The details of the job descriptions and requirements are provided on our website www.eacc.go.ke."
"All applications must be made online and will be acknowledged via an email. Only shortlisted candidates will be invited for an interview."
The deadline for application is set for April 8.
The New Kenya Planters' Cooperative Union, mandated with millions, warehousing, and marketing coffee, has announced that it is seeking to fill 50 positions.
The positions range from director to principal down to legal officers and their deputies.
Details of the post can be accessed on our official website www.newkpcuplc.go.ke/careers and interested candidates are advised to to send their applications to recruitment@newkpcuplc.go.ke or hand-delivered to the Managing Director at Wakulima House before April 16th.
Here are five other stories to keep you engaged today
1.At the Apex. James Mbugua Mwaura has been named the new CEO of KICC taking over from Nana Gecaga. Here is his profile.
2. US Ambassador Meg Whitman says the delay in Haiti deployment of Kenyan officers is a consequence of the delayed creation of a camp in Haiti.
3. Ruto has received Ksh13 billion from China amid talk of his administration's dalliance with the Asian country's communist party.
4. NTSA and Kenya Police launch crackdown on pedestrians breaking traffic laws countrywide.
5. The Kenya Bureau of Standards (KEBS) has directed all manufacturers and importers to ensure that they denature ethanol before release to the public.
This newsletter was written by Derrick Kubasu and edited by Brian Muuo.
Washington Mito contributed to the content.
Graphics prepared by Adongo Kyalo.
