Business highlights – MPs to start earning Ksh1.33 million a month each in June.

Business highlights – MPs to start earning Ksh1.33 million a month each in June.

MPs to start earning Ksh1.33 million a month each in June.

  • Members of Parliament are set for another pay increase, which will see them earn Kh1.33 million each per month beginning in June
  • The rate is 25 times higher than Kenya’s average salary
  • The Parliamentary Service Commission (PSC) has increased the National Assembly’s salary budget to Ksh5.6 billion in the next financial year, up from Ksh5.4 billion in the current year ending in June

The National Assembly has 350 MPs. Each of them will pocket Ksh16 million annually, which is equivalent to a 3.1% pay rise. The pay raise cements their status as super earners at a time when more than half the population lives on less than Ksh200 a day.

Each lawmaker’s current pay, the total of basic salary plus personal allowances, stands at Sh15.4 million a year or Ksh1.28 million monthly. The figure, however, excludes the legislators’ hefty travel budget, which averages Sh591,000 per month.

READ ALSO: MPs to face pay cuts as Kenyatta moves reduce government spending

At Ksh1.33 million, the MPs’ monthly pay is 25 times more than the country’s average monthly salary of Ksh53,736, as per the latest Economic Survey data.

Sugar output falls by 16% as cane shortage continues to put pressure on millers and consumers

  • Sugar production dropped by 16% in February compared with last year as cane shortage hurt production
  • An industry report for the month indicates production fell from 126,362 tonnes registered last year to 104,907 tonnes in the period under review
  • A recent report on sugar status by Sugar Directorate indicates that there will be a shortage of 1.9 million tonnes of sugarcane in 2016/2017 fiscal year, creating a huge deficit of raw material

Three private millers, Butali, Transmara and West Kenya controlled most of the production. Mumias Sugar in which the government has a 20% stake, registered dismal production at a mere 3,023 tonnes attributed to cane shortage.

According to the industry regulator known as the Sugar Directorate, total sugar sales in January – February 2017 were 104,893 tonnes compared to 112,820 tonnes sold in the same period 2016, a decrease of 7%.

READ ALSO: Sugar prices rise 20% as cane shortage hits local millers

Kenya is a sugar deficit country and relies on imports to meet the annual demand by importing about 300,000 tonnes of the commodity from regional countries. Agriculture and Food Authority has also blamed low production on aging State-owned mills.

Government offers textile firms tax breaks to create job opportunities for the youth

  • Kenya’s government has started offering tax incentives to clothing companies, a key part of its under-performing manufacturing sector, to create jobs and provide affordable new clothes for shoppers
  • Executives in the textiles industry said the changes included allowing them to sell 20% of their annual production locally without sales taxes and without paying import duties on the materials and equipment used to produce the garments
  • The advent of cheap, second-hand clothes imports from the US and Europe, locally known as mitumba, in the 1980s, put local apparel firms out of business and killed production of raw materials like cotton

Devolution and Planning CS Mwangi Kiunjuri said the manufacturing sector is still facing some challenges in regards to cheap imports and the counterfeit goods. He said the industry was dealing with the difficulties by implementing new policies to encourage firms to boost production and hire more people.

The government has been paying more attention to the sector in recent years, offering cheaper electricity to textile firms in export processing zones. The removal of sales taxes at a recent local sale resulted in thousands of consumers standing patiently in long lines for a chance to buy garments, which are normally exclusively exported to European and American retail chains.

READ ALSO: Equity to loan SMEs in textile industry up to Ksh100 million

Kenya has the highest rate of youth joblessness in East Africa, the World Bank said, with 17% of all young people eligible for work lacking jobs. Neighbouring Tanzania and Uganda have comparable rates of 5.5 and 6.8%, respectively.

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