This report seeks to examine the current transfer values of Kenya’s tax-financed social security schemes and assess whether they are set at an appropriate level.
In most countries, debates on the value of transfers are a normal feature of policy-making, with proponents usually on both sides of the argument, some arguing that they are too low and others that they are too high. The debates indicate that there is no “right” answer and no agreed approach to determining transfer values. Indeed, there is a range of issues to consider when determining the value of transfers including: the purposes of social security schemes; the cost of a minimum standard of living; potential work (dis-) incentives; costs imposed on beneficiaries for complying with any conditions; and the overall cost and fiscal sustainability of the programme.
including the household consumption and the food poverty line; the Social Security (Minimum Standards) Convention (No. 102) of the International Labour Organisation; legislated minimum wages; and benefit levels of similar programmes in other countries in Africa and the rest of the world. It also examines to what extent transfer values have kept up with inflation.
Overall, transfer values in the country are modest, representing 29% to 40% of what is required to buy a minimum healthy food basket (MHFB) in arid and semi-arid lands or just over half (55%) of the average amount of resources required to close the national food poverty gap. At the same time, transfer values provided in Kenya are in line with or somewhat higher than those offered in other countries when taking into account the size of the economy and thus the financial capacity to fund social protection.