A parliamentary watchdog committee is set to summon the National Treasury to explain why thousands of civil servants are taking home less than a third of their net salaries, with many having committed more than the legally allowed two-thirds of their basic pay to loan deductions and statutory obligations.
The National Assembly’s Public Accounts Committee (PAC) attributes the steep reduction in take-home pay to increased deductions introduced under President William Ruto’s administration, including the Housing Levy, Social Health Authority contributions, and the revised National Social Security Fund (NSSF) rates.
Committee chairperson and Butere MP Hon. Tindi Mwale expressed concern over the growing number of government departments flouting the regulation intended to protect workers from being left without adequate income after deductions.
“The law is no longer practical due to multiple tax deductions that have eroded workers’ earnings,” Hon. Mwale stated, referring to Section 19(3) of the Employment Act, 2007, which prohibits employers from deducting more than two-thirds of an employee’s basic salary.
Civil servants have, in recent months, seen their pay slips shrink, with 1.5 percent of gross pay deducted for the Affordable Housing Levy, 2.75 percent for the Social Health Insurance Fund (SHIF), and increased contributions under the NSSF Act.
In response, the committee has directed the National Treasury to consult with Attorney General Dorcas Oduor on the viability of scrapping or reviewing the one-third salary rule, given the current tax regime.
The matter was raised during a session with Correctional Services Principal Secretary Dr. Salome Beacco, who was appearing before the committee to respond to audit queries.
Lugari MP Hon. Nabii Nabwera warned that unless the issue is addressed, it will continue to feature in audit reports.
“This committee has asked the National Treasury – given the coming into effect of the NSSF Act, SHIF, and the housing levy—to engage the Attorney General for a way forward. If not addressed, this matter will remain an audit concern,” Nabwera said.
“We need a definitive ruling on this issue. Given the current deductions, the one-third rule is clearly untenable,” he added.
Funyula MP Dr. Wilberforce Oundo echoed this sentiment, insisting that civil servants should not be punished for a situation beyond their control.
“These employees are not the authors of their misfortune. It is Parliament that passed these punitive taxes. If blame is to be placed, it lies squarely with MPs who sang ‘Hallelujah’ as the laws sailed through,” said Dr. Oundo.
An analysis of the Integrated Personnel and Payroll Database (IPPD) for June 2023 revealed that 4,082 government officers earned less than one-third of their basic salary, contravening Section C1(3) of the Human Resource Policies and Procedures Manual for the Public Service (May 2016 edition).
