Workers who lose their jobs in the wake of economic shocks such as a pandemic and recession will receive a monthly State pay if a government-backed Bill that seeks to expand the menu of social protection programmes is adopted.
The Social Protection Bill, 2025 has proposed that the affected workers be entitled to the monthly stipend similar to those offered to the elderly, persons with disabilities and orphans.
The State will also extend a lifeline to persons rendered jobless by other shocks, including environmental, ecological, and social disturbance.
The economy has been beset by several shocks that have left thousands jobless, with the most memorable being the Covid-19 pandemic, which left close to two million people without jobs.
“‘Shock’ means a slow or rapid onset of high-impact ecological, environmental, economic or social disturbance that reflects the well-being or socio-economic condition of an individual, household or any segment of the population,” says the Bill, which was tabled in the National Assembly by the Leader of Majority Kimani Ichung’wah.
Currently, beneficiaries of social assistance have largely been the elderly, orphans and individuals with disabilities.
Now, the State seeks to offer a monthly stipend during periods of mass job cuts to ease the pain of loss of income and put money in people’s pockets to boost demand for firms’ goods and services.
The fund will be backed by taxpayers, a departure from an earlier plan by the Uhuru Kenyatta administration to create an unemployment insurance fund (UIF)—funded by employers and workers.
The UIF was supposed to give short-term relief to workers who lost their jobs or were unable to work due to illness.
The plan, which was part of the post-Covid recovery strategy, was quietly abandoned.
The unemployment fund mirrored that of South Africa-- which has so far disbursed huge volumes of cash to support of millions of workers and businesses affected by the vagaries of the Covid-19 pandemic.
The South African scheme also involves employees contributing one percent of their pay, which is matched up by employers.
The current proposal is likely to inflate Kenya’s social welfare programme.
The country spent around Sh31.3 billion in the financial year ending June on various social protection and affirmative action programmes.
“The principal object of the Bill is to reduce poverty and vulnerability and improve the well-being of people by providing assistance, services and programmes that build human capital and cushion people against risks and contingencies throughout their cycles,” said Mr Ichung’wah in the Bill’s explainer.
The proposed law creates the National Board for Social Protection to be responsible for maintaining and updating a register of all the beneficiaries.
The board—whose membership will include a representative of employees and employers—will also periodically register the beneficiaries and update, in real-time, changes in household data by liaising with other national registries.
Social assistance to beneficiaries will be offered either in cash or in kind. Other forms of assistance will be social care services such as rehabilitation services, psychosocial support and respite care services.
Besides social assistance in the form of cash transfers and transfers in kind, including food, the State will also offer social care services. Social care will include rehabilitation services, psychosocial support and respite care services.
Other social care services will be feeding programmes, home-based care and programmes aimed at promoting skills, knowledge and qualifications of a person are
Following the Covid-19 pandemic, the Jubilee administration mooted a plan to create an insurance fund for those who lost their jobs through shocks, which would see employees contribute one percent of their pay, which would be matched by employers.
However, it appears the William Ruto administration has abandoned the unemployment insurance and gone for a government-funded programme in which the State will provide direct support to individuals and families in need, including those who lose their jobs.
Australia has a similar non-contributory programme in which an unemployed job-seeker is provided with a social security benefit. It is funded through general taxation.
The job-seeker support programme is also offered by New Zealand, with jobless people who are actively looking for work being given a monthly stipend.
Given Kenya’s tight fiscal space, expansion of the social protection programme is likely to add to the country’s financial pressure, which has been aggravated by elevated debt service costs.
Kenya is prone to various shocks, including floods, drought, financial crises, global economic downturns and price volatility in the global market.
The Kenyan economy has also been affected by political instability and elections, with the electioneering period being characterised by reduced investment as investors adopt a wait-and-see approach.
Terrorist attacks, particularly from the Somalia-based Al-Shabaab, have damaged infrastructure, and at some point disrupted tourism and created an environment of fear in the coastal areas.
Once the Bill becomes law, the Cabinet Secretary in charge of Social Protection is expected to come up with regulations to give clarity to most sections of it.
The contributions towards the fund would generate at least Sh23 billion annually on implementation.
Currently, salaried workers have seen their payslips thin after the introduction of the 1.5 percent affordable housing levy, and increased deductions towards the National Social Security Fund and the Social Health Insurance Fund.
