In the wake of the recent announcement by President William Ruto, all Cabinet Secretaries have found themselves unexpectedly dismissed from their positions.
President Ruto assured the nation that the government would continue to function smoothly, with Principal Secretaries.
As the dust settles, attention has shifted to the compensation packages these high-ranking officials will receive upon their departure.
Gratuity payments for dismissed cabinet secretaries
Despite the abrupt end to their tenures, the dismissed Cabinet Secretaries are set to take home significant sums.
According to the Salaries and Remuneration Commission (SRC) guidelines, each of the 21 dismissed Cabinet Secretaries and the Attorney General will receive a gratuity payment of at least Sh2.45 million.
In total, the taxpayer will bear the burden of approximately Sh54 million in gratuity payments.
SRC guidelines on gratuity payments
The SRC regulations stipulate that a relieved Cabinet Secretary is entitled to a gratuity of 31% of their basic salary for each year served, with this amount subject to a tax of up to 30%.
The calculation of these payments varies based on the different pay periods during their tenure.
Financial breakdown for the first year in office
For the initial financial year, from November 2022 to June 2023, the basic salary for all Cabinet Secretaries was Sh554,400.
Consequently, each dismissed official will receive a gross gratuity of Sh1.37 million for this period. After accounting for tax deductions, this amount reduces to Sh962,438.
Pay rise and subsequent gratuity calculations
In the following financial year, between July 2023 and June 2024, a gazette notice by the SRC increased the basic salary for all Cabinet Secretaries to Sh574,200.
This adjustment means that each dismissed official will receive a gross gratuity of Sh2.14 million, which reduces to Sh1.49 million after tax deductions.
Total gratuity received
Overall, each dismissed Cabinet Secretary will receive a total of Sh2,452,438 after tax for their 21 months of service in the Kenya Kwanza cabinet.
This brings the total amount payable by the taxpayer to Sh53,953,636.
It is important to note that if any of the dismissed Cabinet Secretaries are reappointed in the next cabinet to be reconstituted by President Ruto, they will not receive the gratuity payments.
