Household budgets stretched thin as cash-strapped families dig deep to get by

By Jackson Okoth

Kenya: An Ipsos Synovate survey released last week found one in every four Kenyans goes to bed hungry as a result of the rising cost of food.

It also found that most Kenyans find the cost of living the most serious problem facing the country, ranking it above lack of employment, corruption, insecurity and poor leadership.

Mr Daniel Gwaro, 33, is a security guard who lives in the Kibera slum and takes home a salary of Sh6,000. He has two children aged five and three. For him, the rising cost of maize flour has been the biggest blow.

No lunch

“We only eat breakfast when there is money, and we’ll spend Sh50 for mandazis at Sh5 and black tea — I can’t afford the one with milk.

“I stopped eating lunch a long time ago. The children sometimes get rice for lunch, but only if there is money. The only thing my wife and I budget for is dinner. We eat ugali and sukuma every day, and for our family of four, it costs Sh60,” he said.

Mr Gwaro said he has no cash to spend on luxury items like beer or the odd soda.

“When I was single, I used to drink. But raising a family on Sh6,000 is difficult; it is not possible to drink beer.”

And airtime?

“I buy credit worth Sh20 for the month once I get my salary. The most I’ll spend is Sh40.”

Perhaps Gwaro’s situation helps explain why there have been demonstrations  in various counties as residents protest new fees, levies and taxes imposed by the local administration, yet every cent they earn is already stretched thin.

Many individuals are also digging deeper into their pockets to pay school fees, buy textbooks, support relatives, commute to and from work, access the Internet and cater for basic needs.

As a result, pressure is building for Parliament to amend the Value Added Tax (VAT) 2013 to exempt basic goods from the tax bracket.

Digital switch

Consumers are also grappling with an increase in electricity bills after VAT moved from 12 per cent to 16 per cent.

The new VAT law, which came into effect in September, has hit households in the middle and low-income brackets the hardest, with many families decreasing their list of essential household items to cope with the rising prices. 

“Bread is now Sh50, and in my house, my two teenage boys, husband and househelp finish two entire loaves a day. We cannot sustain that kind of budget. We’re moving to more traditional foods like arrowroots and yams. The boys don’t like it, but what options do we have?” Ms June Waceke, 42 and a grocer, asked.

For Ms Mary Mwangi, a single parent with two children and living in Nairobi, it is a delicate balancing act as she tries to figure out what to strike off the shopping list.

“The increase in the price of processed milk has forced me to buy raw milk from dispensers. And with prices of textbooks, electricity and food going up, I have been forced to cut down on luxury items and unnecessary household expenses.”

Her monthly shopping list includes only what she considers the essentials — cooking oil, flour, bar soap and so on.

There is also the issue of the switch to digital television. At the moment, many homes are relying on analogue TV transmission signals and have no idea where they will scrape together Sh3,000 to Sh6,000 for a digital set top box.

There are those considering doing without TV altogether if the analogue signal is switched off, relegating this to a growing list of luxury items.

Demand for higher salaries in the public sector is also pushing up the wage bill, leaving the Government with little to create the kind of economic environment that would increase production and push down the prices of food and other items.

“We need to cut down on wastage, including unnecessary foreign trips by public officers, as well as put on ice such measures as increasing contributions to the National Social Security Fund as a way of cushioning the common person,” said Mr Kariithi Murimi, a risk consultant.

While the increase in NSSF rates has been deferred to May, 2014, its implementation will squeeze more shillings out of an already burdened consumer.

And then there is the issue of rent.

Eight in 10 Kenyans live in rented accommodation, and house prices have been on an upward trajectory.

“We used to live in Nairobi West and were paying rent of Sh15,000. In January last year, our landlord said we would have to start paying Sh24,000. We protested the increase, and she told us to move out as there were people waiting outside to move in.

“The unreasonable rent increases in every estate we moved to kept pushing us further and further away from Nairobi. We finally had enough and moved to a two-bedroom in Syokimau. We pay Sh18,000. I don’t know how long such rents will last as there is more demand for houses in this area,” Ms Waceke said.

For Gwaro, rent is not too big a problem as it has remained relatively constant over the years, but the strain on the money left over has seen him consider moving his family to his rural home.

“Life has become too hard. In Kibera, you pay for everything. We buy water, we pay to use the toilet, we pay to take a bath — now I’m thinking of taking my wife and kids to ushago, and then I send them whatever little money I get.”

bizbeat@standardmedia.co.ke