The President said the growth in public sector wage bill is unsustainable and unacceptable pointing out that in the current financial year, the total remuneration in the public service will account for 55 percent of the tax revenue and 13 percent of the Gross Domestic Product (GDP).
“Yes, it is good to pay our people well but this must be done in a manner conducive to our development agenda,” the President said.
He said implementation of mega projects including the Standard Gauge Railway, the South Sudan and Ethiopia Transit Corridor and the million-acre irrigation programme in Galana would suffer if the development expenditure continued to dwindle due to pressure of wages.
“The monster threatens not just our future, but our present too, since it compromises the stability of our present economic framework,” he said.
The President also expressed the need to streamline the management of salaries at all levels of Government to remove the disparities in remuneration in the public service both at national and county levels.
“Although the Salaries and Remuneration Commission, and the Public Service Commission will take the lead in creating rules and principles for containing the disparities, I would urge every Kenyan to make their views heard on this matter,” the President said.
The President said the Government is auditing its payroll to weed out ghost workers and ensure only legally-hired employees are paid a salary.
“In this context, I urge you all to give maximum cooperation to the Ministry of Devolution and Planning, which is carrying out this exercise,” he said.
He added that the Government has already carried out a comprehensive review of parastatals to reduce project slippages.
The President spoke on Monday when he launched the “National Debate on Public Wage Bill Sustainability.”
During the conference, he ordered parastatal chiefs to take a 20 percent pay cut or quit.
He said his Government was instituting major reforms in the parastatal sector and chief executives who may not be willing to conform can resign.
The President also challenged the National Social Security Fund-NSSF to change its investment policies and adopt new approaches which will benefit the contributors.
President Kenyatta and Deputy President William Ruto last week took a 20 percent pay cut while Cabinet and Principal Secretaries took a 10 percent salary reduction.