TEACHERS SERVICE COMMISSION ORGANIZATION: TEACHERS SERVICE COMMISSION KENYA. ADDRESS: THE BAZAAR, MOI AVENUE/BIASHARA ST. PRIVATE BAG, 00100 NAIROBI KENYA. PROJECT: PAYMENT OF SALARIES THROUGH ELECTRONIC FUNDS TRANSFER (EFT) SYSTEM AND POSTAL CORPORATION OF KENYA (PCK). CONTACT PERSON: SIMON M. KAVISI, SENIOR DEPUTY SECRETARY (ADMINISTRATION) TEL. (254) (020) 312068/312089/312393 FAX NO: 254-O20-211818 E-mail: info@tsc.go.ke simkavisi@yahoo.com NUMBER OF EMPLOYEES: 237,400
1.0 BACKGROUND The Teachers Service Commission (TSC) is one of the Semi Autonomous Government Agencies under the Ministry of Education. It was established in 1967 through an Act of Parliament and mandated to perform teacher management functions that include registration, recruitment, deployment, remuneration, and promotion, discipline of teachers and maintenance of teaching standards. Currently, the TSC provides services to 235,000 teachers distributed in over 22,000 educational institutions across the country. This makes the TSC the largest single employer in the East African region. It handles Kshs 68.5 billion (US$ 979 million) per annum or Kshs 5.7 billion (US$ 81 million) per month in Personal Emoluments. This translates to 70% of the annual budget of the Ministry of Education, and 16% of the country s national budget. The large workforce has posed operational and management challenges over the years; and one of these challenges included perpetual delays in payment of salaries. When the TSC declared its Service Charter in 2000, one of the key commitments was to pay teachers salaries by the last day of the month. This was after the realization that teachers were wasting so much teaching time traveling to pay points only to be turned back because salaries had not been received. Others would wait at the pay centres for up to one week before going back to school after receiving payment. This submission singles out payment of salaries through the Electronic Fund Transfer (EFT) system and the Postal Corporation of Kenya (PCK) as one of the key reform initiatives undertaken by the TSC towards improvement of service delivery. 3.0 IMPETUS FOR THE CHANGE The management and processing of the TSC payroll has been one of the most challenging functions due to the huge size of the workforce, manual processes, data corruption and geographical distribution of teachers. Prior to the introduction of EFT system in 2001, the Commission used to process salaries through individual banks (for employees with bank accounts) and District Education Offices (for employees without bank accounts). This arrangement involved production and dispatch of a huge volume of cheques (on average 2,000 cheques per month) to the banks and DEOs offices across the country. 2
However, the system had many loopholes, including:- Loss of teaching time on average one week every month as teachers waited for salaries at the pay centres. This adversely affected curriculum delivery, and hence compromised the quality of education. Perpetual delays in payment of teachers salaries led to poor relationship with the teachers unions, which occasionally called for industrial action. Influx of teachers and third party officials at the TSC headquarters due to delays in payments. Heavy volume of paperwork in terms of payment vouchers and cheques, and lengthy process of distribution to the numerous pay centres across the country. This led to high cost of labour, stationery and postage. Frequent loss of funds through misappropriation and mismanagement. Frequent cases of misdirected or lost cheques, leading to delayed payments. Delays in returning unapplied salaries from the paying agents. 4.0 PURPOSE AND OBJECTIVES OF THE CHANGE The purpose of the change was to enable the TSC pay salaries and allowances by the last day of the month. The objectives were to:- Enable teachers to spend more time on curriculum delivery. Eradicate cases of loss of funds through misappropriation and mismanagement, and minimize operational costs. Improve the corporate image of the TSC. 5.0 INNOVATION PAYMENT OF SALARIES THROUGH EFT AND PCK To ensure that salaries were paid by the end of the month in line with the Customer Service Charter, consultative meetings were held between the TSC and various financial institutions with a view to achieving this commitment. The innovation involved integrating 26 different payrolls of about 9,000 employees each into a common database, and identifying a single agent, through whom the TSC 3
would pay staff salaries. It also entailed a shift from a more manual system of processing salaries and issuing multiple cheques to an automated system. How the Innovation Was Done Payment through the Bank: In 2001, the Commission signed an agreement with the National Bank of Kenya (NBK) for payment of salaries electronically. Before the implementation of the new system, the NBK undertook a data clean-up exercise to ensure that bank accounts and pay points held in the payroll were accessible through EFT. The new mode of paying salaries through EFT was launched in November 2001. Today, the bank maintains a database for all employees paid through other banks and transmits salaries electronically directly to their accounts. In addition, the NBK captures all stoppages/recall of salaries and transmits the same to employees bank accounts. All unclaimed salaries are credited back to the TSC bank account. Payment of Cash Salaries: The NBK signed an Agency Agreement with the Postal Corporation of Kenya (PCK), for payment of salaries through Post Offices, especially in the rural areas not reached by commercial banks. The PCK has a network of about 890 offices distributed in all market centres in the country. Payment schedules submitted to the NBK are passed on to PCK for distribution and payment through its branches. Salaries are usually available at the Post Offices by the 28 th day of the month. 6.0 RESULTS ACHIEVED TO-DATE This innovation has yielded the following benefits; 6.1 More time spent on curriculum delivery. Prior to the innovation, salaries were usually paid after the 5 th of the following month, sometimes two weeks after month end. With the innovative arrangement, salaries are being paid by the 28 th day of the month. Teachers without bank accounts used to cover an average of 100 km to the DEOs offices to be paid. Under the new method, they travel an average of 3-5 km to the nearest Post Office to get their salaries. This has allowed teachers to devote most of their time on curriculum delivery, and thus achieving better coverage of the syllabus. 4
6.2 Improved industrial relations. The innovation has resulted to improved industrial relations between the TSC and the teachers unions. Since 2001, there has been no incidence of street demonstrations occasioned by delayed salaries. It has also enhanced the general public relations with stakeholders, especially the third parties. 6.3 Decongestion at TSC headquarters. Timely payment of salaries has significantly reduced the number of teachers and third parties visiting the TSC headquarters. 6.4 Reduced paper work and expenditure. The new method has reduced the number of cheques issued per month from an average of 2,000 to 52; and the volume of paper work and the concomitant costs of stationery and postage have been reduced significantly. 6.5 Reduced cases of loss of funds. The new method has significantly reduced instances of loss of funds through misappropriation and mismanagement. Unapplied salaries are promptly credited to the TSC bank account. Prior to the innovation, the TSC lost an average of Kshs 2 million (US$ 0.03 million) per month. Currently, there are no cases of funds lost in the remuneration channels. 6.6 Cases of misdirected/lost cheques. Following the innovation, cases of misdirected/lost cheques are non existent. 6.8 Elimination of errors. The EFT system has an in-built data validation facility, which minimizes data entry errors, and thus enhancing data credibility. 7.0 OUTLOOK FOR THE FUTURE The TSC vision is Effective Service for Quality Teaching. The road towards the realization of this vision requires automation of operations that will guarantee the provision of accurate and timely information for decision making. To achieve this objective, the TSC began implementing the Integrated Payroll and Personnel Database (IPPD) system in March 2003. At the moment, data for 64% of the teachers has been captured. The IPPD system enhances efficiency in payroll processing by minimizing the time spent in data entry and validation by taking advantage of its on-line update and processing features. It is envisaged that the 5
system will sustain and further enhance the gains achieved in the processing and management of the TSC payroll. 8.0 POTENTIAL IMPLICATIONS FOR OTHER ORGANIZATIONS The innovation has been in place for six years. There is indication that it can be replicated in other large public service organizations in Kenya, such as the Ministry of Health, the Kenya Police Service, and the Provincial Administration whose workforce is distributed in all the lowest level administrative units in the country. The Postal Corporation has already adopted a similar system dubbed the PostaPay (an instant money transfer system) to remit money to its clients across the country. The innovation can also be replicated in other countries in the Sub-Saharan region such as Tanzania, Uganda, Zambia, and Zimbabwe which have similar social and geographical characteristics and might not be well endowed in terms of infrastructure and financial institutions network. 9.0 EXECUTIVE SUMMARY The EFT system of salary payment has significantly enhanced efficiency in service delivery at the TSC, as well as increasing teacher-pupil contact time, thus contributing to improved quality of education. This innovation could be adopted by other organizations with a view to improving efficiency. 6
BIBLIOGRAPHY Kenya Government (1968). The Teachers Service Commission Act: Chapter 212 of the Laws of Kenya (revised edition). Nairobi, Kenya: Government Printer. Kenya Government (2002). National Development Plan (2002-2008). Nairobi, Kenya: Government Printer. Teachers Service Commission (September, 2005). Report on Customer Satisfaction Survey Conducted at the TSC Headquarters. Nairobi, Kenya. Teachers Service Commission (2005). Code of Regulations for Teachers Revised. Nairobi, Kenya: Government Printer. Teachers Service Commission (2002). Customer Service Charter. Nairobi, Kenya: Government Printer. Teachers Service Commission (2005). TSC Strategic Plan (2005-2010). Nairobi, Kenya: Government Printer. Teachers Service Commission (2004). Teachers Image A Quarterly Magazine of the Teachers Service Commission, Vol.6. Nairobi, Kenya: Oakland Media Services. 7
Annex.11 Standards/Benchmarks in the TSC Customer Service Charter Service/Function Standard/Benchmark Registration (i) Upon receipt of application for registration, the Commission will process, register and dispatch certificate of registration within fourteen (14) days (ii) Bulk registration forms for the purpose of employment will be processed within the scheduled time for the recruitment programme Recruitment In the event that a vacancy exists, it will be advertised and the procedure for recruitment will be applied to ensure that all qualified candidates are given equal opportunity for selection Deployment: (a) Posting (b) Transfers (i) Upon recruitment, the successful candidates will be posted within fourteen (14) days (ii) After study leave or upon determination of a discipline case, a teacher will be posted within seven (7) days (iii) Where the Commission feels that a teacher must be interviewed before posting or deployment, the candidate will be interviewed within thirty (30) days (i) Transfer request will be acknowledged within seven (7) days from the date of receipt of a teacher s application (ii) In determining transfer requests, consideration will be based on availability of a replacement in the current station and a vacancy in the requested station; the outcome will be communicated to the concerned teacher through the respective Commission agent 8
Remuneration (a) Payment of Salaries (i) Salaries/allowances will be paid to teachers by the last day of each month (ii) Pay slips will be dispatched to the districts/institutions by the 25 th day of each month (iii) Requests for change of pay point will be effected on the payroll for the month if received on/before the 2 nd day of that month. Otherwise, it will be effected in the subsequent month (iv) Third party deductions cooperatives, insurance, hire purchase, etc. will be effected upon receipt of instructions of the teacher through the company within the same month, if received on/before the 2 nd day of the month (v) All statutory deductions effected on a teacher s pay slip will be remitted to the respective organizations by the 10 th day of the month following the month the salary is due (vi) In the event of an error reported/detected, correction on the payroll will be made in the subsequent month (b) Returned Salaries (c) Other Payments (vii)on receipt of an Appointment/Casualty return, the teacher will be reinstated on the payroll within a month, if it is received on/before 15 th of the previous month (i) Returned salaries will be processed and paid within twenty one (21) days upon receipt of a teacher s (written) claim (ii) Whenever a teacher s salary is returned by the bank due to closure of his/her account, the Commission will pay the teacher s subsequent salaries by cash through the Postal Corporation (iii) Any erroneous salary recovery will be refunded to the concerned teacher within fourteen (14) days (i) Reimbursement of in-patient medical expenses, traveling/ accommodation expenses, or per diem will be processed and paid within fourteen (14) days upon receipt of a teacher s claim, subject to availability of funds (ii) Medical ex-gratia claims will be paid within six (6) months subject to availability of funds (iii) Replacement of stale cheques will be made within fourteen (14) days upon receipt of written claims (iv) Issuance of P39 and P9 (Income Tax forms) will be made available to teachers on request (v) Teachers will be issued with receipts at the cash office within fifteen (15) minutes upon settlement of TSC liabilities Promotions (i) Promotions will be granted in accordance with the existing schemes of service for teachers (ii) Promotions will be processed, when due, within thirty (30) days Confirmation of On completion of two (2) years probationary service and upon 9
Appointment receipt of an application for confirmation, the Commission will make a decision on the confirmation within thirty (30) days Leave Applications for study/sick leave will be processed and a decision communicated to the applicants within thirty (30) days Pension/Death Gratuity Upon receipt of the required documents (i) Claims for pension will be processed and forwarded to the Treasury within three (3) months before the date of retirement (ii) Claims for death gratuity will be processed within six (6) months Discipline (i) Discipline cases will be determined within six (6) months from the date of registration, if all the required documents have been submitted (ii) Decisions on discipline cases will be communicated to the teachers concerned within fourteen (14) days from the date of hearing Handling of Complaints The Commission undertakes to handle any complaint through the relevant Heads of Department/Division. However, in case of dissatisfaction clients are advised to channel their complaints through the Public Relations Office Communication The Commission believes that effective communication is key to ensuring efficiency in service delivery. Thus, the Commission will appreciate feedback from its clients. 10