The Kenyan economy is in a very poor state. Meaningful employment is hard to come by even for graduates, let alone school leavers. Many people are driven to the informal sector, to set up ‘side hustles’ to earn enough income to survive. So many families still earn barely enough to eat, let alone save for luxuries like school fees.
It is estimated that Kenya spends half its annual tax revenue to cover its debt burden. It is not helped by a currency that has been falling against other world currencies especially the dollar.
The government have been looking at ways to increase their revenue and recently proposed introducing a series of charges for national ID cards (which are mandatory for all citizens), passports plus birth and marriage certificates. These charges would undoubtably make life more difficult for many. Our sponsored students for example, need an ID card to apply for a student loan and open a bank account. At eighteen they can’t attend college without one. This proposal was suspended by the courts.
In recent weeks President Ruto has proposed a new Finance Bill which would see taxes raised. These taxes include:
- salaries
- a housing tax
- health insurance
- small businesses (a doubling of the tax on small business sales).
But perhaps more crucially this would also include a levy on bread, cooking gas, fuel (where the tax would double from 8% to 16%), and sanitary pads.
Fuel and maize prices have already increased this year (maize by 30%) leading to greater poverty. The proposed tax increases would make life much more difficult for the Kenyan people and have a serious impact on the economy, with companies cutting costs (and staff levels) to cope with increased business costs.
The proposal resulted in widespread demonstrations in Nairobi and across the country, which have been widely reported in the international media.
On the day that the Kenyan parliament was due to debate the Finance Bill, the parliament building itself was attacked. The military were mobilised to patrol the streets.
I vividly remember attending a football game at the national Nyayo Stadium a few years ago. Everything was fine, a carnival atmosphere even. Then one team scored, and the fans of the losing team began to throw rocks at the linesman nearest them. The game was halted several times in an attempt to bring order. Eventually the referee abandoned the game. As we left the stadium my eyes were streaming – because the police had fired teargas into the stadium. It was deeply unpleasant for everyone, and the atmosphere became very menacing.
This week the police used teargas on the streets to quell the demonstrations. I can only imagine the terror this created. They also used rubber bullets and live rounds. International news agencies estimate that over 20 people were killed and many, many more were injured. Some took refuge at a temporary first aid camp at the All Saints Cathedral, where we held our student workshop in December.
There has been a local and international call for restraint. President Ruto has withdrawn the proposed Finance Bill. However the challenge for the economy remains. Unable to raise taxes, the government may now decide to cut services – which in turn will make the life more difficult for the people of Kenya.
Education is already chronically underfunded.
This is the environment in which we provide our scholarships. The need is unlikely to go away any time soon.