PSC has no powers to determine salaries for parastatal staff, says AG

The Public Services Commission (PSC) has no powers to determine terms and conditions of service, including remuneration and benefits of employees of state parastatals, according to Attorney General Justin Muturi.

Muturi said PSC can review and recommend conditions of service, code of conduct and qualifications of officers in the public service to CSs, but not directly to parastatals.

“While public bodies are defined to include State corporations under section 2 of the PSC Act, there is no express provision conferring power to the commission to make recommendations directly to public bodies," said Muturi who was responding to Prime Cabinet Secretary Musalia Mudavidi who, on June 8, 2023, sought an advisory on the jurisdiction on constitutional powers of PSC concerning the human resource function in state corporations.

"The recommendation is to the Cabinet Secretary, who receives the same on behalf of the National Government,” according to an advisory by Muturi dated June 8.

Recent litigations

Mudavadi’s inquiry was in light of the recent litigations on the powers of the PSC, Salaries and Remuneration Commission (SRC) and State Corporations Advisory Committee (SCAC), in the running state corporations, especially on hiring and remunerations.

The AG said the constitution and the Public Service Commission Act do not confer powers on the PSC to determine or approve terms and conditions of public service officers, code of conduct, or qualifications.

On the establishment and dissolution of state corporations, Muturi said under Article 234 of the Constitution, the PSC does not have powers to establish and abolish offices in the public service, appoint persons to hold or act in those offices or confirm appointments and exercise disciplinary control over and remove persons holding, or acting in those offices.

Establish and abolish offices

“However, Article 234 (2) (a) (i) (ii) that bestows the mandate to specifically establish and abolish offices in the public service and appoint persons to hold or act in those offices and to confirm appointments to PSC is subject to the Constitution and legislation,” said Muturi in his advisory.

The AG stated the power of PSC is limited to the offices established by the commission under Article 234(2)(a)(i) and does not extend to the establishment of state corporations, “save where expressly provided for by specific pieces of legislation under 234(2)(j) of the Constitution”.

He said in discharging the mandate, PSC may investigate, monitor and evaluate the organization of the public service for any public body and make recommendations to the public body, the president and parliament.

“The recommendations under section 58(2) may include the establishment or amalgamation of any public bodies including state departments, addition to or subtraction from a department or division, directorate, unit, section or other organizational arrangement; naming or renaming of any public body, department or division, directorate, unit, section or other organizational arrangement or abolition of any public body, department or division, directorate, unit, section or other organizational arrangement,” said Muturi.

He added: “Under section 58 of the Act, the mandate of PSC concerning the establishment and dissolution of state corporations is limited to making recommendations after investigation, monitoring, and evaluation of the organization of any public body within the public service.”

Muturi also said the role of the State Corporations Advisory Committee (SCAC) is purely advisory and does not in any way conflict with the mandate of the PSC to establish and abolish offices in the public service.

State corporation 

“Section 5(3) of the State Corporations Act provides for the power of a state corporation to employ the chief executive officer and other staff and to determine their terms and conditions of service," said the AG.

“Under the provision, a state corporation may engage and employ such a number of staff, including the chief executive on such terms and conditions of service as the Cabinet Secretary may, in consultation with the Committee, approve. The approval of the terms and conditions is by the Cabinet Secretary in consultation with the Committee. SCAC should only play an advisory role.”

He said SRC is the entity vested with the constitutional mandate to advise state corporations on remuneration and benefits of employees.

“The nature of advice issued by SRC about public bodies was adjudged by the Supreme Court, which held that no valid salary, and or benefit of a state or public officer, shall ensue from a process that ignores the role of SRC,” said Muturi.

Purposes of consistency 

He added: “Where a lacuna exists within these laws, we encourage state corporations to liaise with the PSC for purposes of consistency and harmony to promote the fulfilment of the values and principles of public service enshrined in Article 232 of the Constitution.”

Muturi, however, emphasized that PSC needs to appreciate that its power to establish and abolish offices in the public service is "subject to the constitution and legislation", meaning the power can be taken away by legislation, such as the State Corporations Act, and Office of the Attorney General Act in some instances.