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Last Updated: Friday, 18 July, 2003, 13:34 GMT 14:34 UK
Kenya seeks 'ghosts' to ease budget woes
Kenyan President Mwai Kibaki
Kenya's Mwai Kibaki promised an end to misrule
Kenya is considering a sweep of its civil service to track down "ghost workers", imaginary employees created on the payroll by corrupt workers to pad their pay packets.

The government was worried that despite a 10% reduction in headcount under the previous government, the wage bill had in fact swelled by 2%, Finance Minister David Mwiraria told Parliament.

Part of the problem, he said, was that workers had either added fake names to the payroll - or indeed had entered their own names more than once.

Cleaning out these "ghost workers" would, along with tightened tax collection controls, help bring the deficit down from a predicted 62bn shillings to about 47bn shillings (390m; $621m) for the year to June 2004, he said.

He also warned that scammers were using Finance Ministry letterhead paper to ask Kenyan businessmen for contributions to non-existent public works projects.

This is probably the most important issue for the government in terms of dealing with the budget deficit
Razia Khan
economist, Standard Chartered Bank
Several companies had received letters soliciting millions of shillings for refurbishing public buildings, asking that the money be deposited "strictly in cash" in an account at a National Bank of Kenya branch on the same road as the Finance Ministry.

Off balance

The urgency of the ghost worker cleanup was underscored by Razia Khan, Africa economist at Standard Chartered Bank.

"This is probably the most important issue for the government in terms of dealing with the budget deficit and promoting the development it has promised," she told BBC News Online.

In March 2003, wage spending took up 34.6% of government spending - but development spending was just 11.6%, meaning that even a small saving on wages and salaries could greatly boost the development budget.

Even that, she pointed out, was an improvement on the 36.5-8.5% split seen a year earlier under the previous government.

"Politically it may be difficult, but there's every indication that the government is going to take it seriously," she said.

Cleaning up

The new National Rainbow Coalition government swept to power in December on a platform advocating a cleanup of Kenya's notoriously corrupt public sector.

Mwai Kibaki, who replaced Daniel arap Moi as president after more than two decades in power, immediately employed an anti-corruption activist as chief government watchdog.

John Githongo
John Githongo switched from campaigner to official watchdog
Progress has been modest, as Mr Moi's supporters have fought back, claiming that he is not being shown the respect he "deserves as an elder".

It was the Moi government that instituted the supposed clearout of the civil service mandated by international donors, who ostracised Kenya two years ago for the government's failure to push through anti-corruption legislation.

Still, recent visits by the World Bank and International Monetary Fund chiefs presage a resumption of lending within the next few months.

Widespread problem

The problem of "ghost workers" is by no means confined to Kenya.

In the past month, the main Zambian civil servants' union has called for a crackdown on what it says are more than 20,000 ghost workers, contributing to a budget over-run of 600bn kwacha (80m; $132m).

Only two years ago, the Nigerian civil service almost ground to a halt in a search for ghost workers - many of whom, local observers say, are back on the books.

And in the Central African Republic, Prime Minister Abel Goumba has asked banks to make it easier for civil servants to open accounts, in the hope that cash payments can be scrapped to aid the removal of ghosts from the payroll.




SEE ALSO:
Rising hope for aid to Kenya
10 Jul 03  |  Business
Kenya to greet IMF boss
03 Jul 03  |  Business
Kenya targets corrupt officials
17 Apr 03  |  Business
Public inquiry into Kenya gold scam
14 Mar 03  |  Business
Kenya's strides in corruption fight
28 Feb 03  |  Business


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