Can we afford the teachers pay rise? Yes we can!
The Sunday Nation
Nairobi,
13 September 2015
Can we afford to pay
teachers the 50% to 60% increment as ordered by the court? The
government through the Cabinet Secretaries for education and for finance
has said that it does not have the money and that, even if did, it would
have to get authority from parliament since the budget process has
already been concluded. I am not satisfied by that answer.
According to the
Teachers Service Commission, TSC, the increment will raise the monthly
payroll by about Sh1.4 billion, or Sh17 billion annually. I agree; Sh17
billion is a lot of money – if you gave it to me, I would stop charging
for my services and work free of charge for the rest of my life!
That’s just me, but
is Sh17bn a lot of money to our government? In the 2015/16 budget, the
government plans to spend about Sh2.1 trillion on various activities.
For some one planning to spend this kind of money in a year, Sh17
billion is just but a drop in the ocean – it is only 0.8 per cent!
Suppose you have a
household budget of Sh21,000 per month and then the cost of one of the
items you buy regularly went up by Sh170; how would that affect your
finances? Would you be able to cope with that increase?
That’s the same
effect that Sh17bn has on the National Treasury. I believe you can
easily make some savings here and there to cover the extra Sh170 –
perhaps skip one beer during the month! The (highly paid) experts at the
National Treasury should also be able to do the same.
Furthermore, in
2015/16, the TSC proposed to spend about Sh188bn on teachers’ salaries.
An additional Sh17bn is about 9 per cent of this budget. I believe that
with prudent management (for example, pruning ghosts out of the
payroll), the TSC can also find the extra Sh17bn without having to go
back to the National Treasury.
I am also surprised
that this Sh17bn increment was not captured as a contingent liability in
the budget given that the salary dispute was already in court at the
beginning of the year. It was extremely naïveté to expect that the only
possible outcome was a win for TSC!
A few years ago, East
African Breweries were sued by one their major distributors for breach
of contract. The distributor demanded Sh240 million compensation. For
the years that the matter was in court, the company carried this amount
as a contingent liability in its books. That’s what prudent financial
managers do because you cannot know which way the court will rule. I
cannot understand why TSC did not do the same.
In the end, I know that the teachers will get their pay rise, so the big question in my mind is: why do we have to keep children out of school for weeks yet we will have to pay?
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