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State hikes civil servants’ rent for the first time in two decades

NEWS
By Patrick Alushula | Jan 27th 2022 | 3 min read
By Patrick Alushula | January 27th 2022
NEWS

Some of the Civil servant houses at St Xavier Area in Nakuru. [Julius Chepkwony, Standard]

Civil servants occupying government houses are set to spend more on rent starting April after the State announced an increase in rates for the first time in 21 years.

The State Department for Housing has informed the Treasury that monthly rental income on all government residential houses will rise by 10 per cent starting April.

The hike comes on the back of Auditor General Nancy Gathungu faulting the Housing ministry for failing to align the rent to current market rates despite civil servants’ house allowances having been reviewed several times to reflect the cost of living.

Housing and Urban Development Principal Secretary Charles Hinga said the review will still be “way below” the market rate since government houses are part of employer-assisted housing for civil servants.

“Notice is hereby given that effective April 1, 2022, rent from all government residential houses will be increased by 10 per cent of the prevailing rates,” said Mr Hinga in a notice shared with the Treasury.

An audit report for the year ended June 2020 showed the total number of government houses in the 47 counties stood at 56,892 with an annual rent potential of Sh1.52 billion when fully occupied.

A 10 per cent hike means the State stands to receive an additional Sh152.5 million, assuming the houses will be fully occupied.

Hinga told The Standard yesterday that the main reason for the review is that “rent has not increased since 2001.”

But the State department will struggle to collect the rent unless it fixes the loopholes pointed out by Ms Gathungu in her audit report.

The auditor general said the register of the 56,892 houses maintained by the ministry did not contain key information such as the dates of occupancy and vacancy, occupants’ details and reason for non-occupancy.

“Failure to maintain a comprehensive register makes it difficult to keep track of government houses and tenants in relation to occupancy, vacancy of the houses, houses with rent arrears and their respective maintenance costs,” she said.

Collection shortfall

The audit report showed rent collections from government houses was Sh724.3 million in the year ended June 2020 against the annual potential of Sh1.52 billion. 

It said the Sh800.3 million shortfall - 52 per cent- was partly on account of some civil servants not paying the required rent.

Gathungu’s report further showed that for the houses occupied by county governments’ staff, payroll deductions totaling to Sh113.4 million were made but only Sh16.38 million, or 14.4 per cent, was remitted to the Housing ministry.

The auditor general said the housing department failed to put in place measures to ensure that all rent income due was collected in accordance with regulation 43(c) of the Public Finance Management (National Government) Regulations, 2015.

The regulation requires an accounting officer to ensure that all appropriations-in-aid due to a national government entity are collected and properly accounted for.

 

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