Thursday, October 3, 2013

What Kenya can learn from Thatcherism

Any government has to formulate policy to regulate its relations with businesses. In doing so it is faced with one dilemma. This is spurring economic growth while improving standards of living. Matters of wages and conditions of employment are at the heart of this quagmire.

You will recall the demand for salaries by members of the National Assembly and the teachers strike. A common trend of industrial actions and general instability in the labour sector has been witnessed. Most recently was the strike by workers of the Nairobi County.

It is not a headache for the national government only. Inevitably now, County governments must now contend with the possibility of disgruntled employees. Contributing factors include the ongoing transfer of functions between national to county governments. These upheavals come amidst the respective government’s efforts to re-align and harmonise its human resource.

These are just but a few tremours witnessed in the labour industry. Perhaps the volcano is yet to erupt. However before eruption begins, the government must seriously re-evaluate its national labour policy guideline. It will be aimed at aligning the wage policy with its overall vision of a prosperous Kenya.

From my reading of the book “Business and Politics” A comparative approach, one question arose. Can Kenya learn from the Labour government in Britain? In brief, the administration of Margaret Thatcher adopted three policies in its relation with businesses.

First the government withdrew from direct involvement in business. It allowed more free market operations. Secondly, there was a change in the Labour laws that caused a shift of power from trade unions to businesses. Lastly, the government made Britain the least regulated and more market driven economy within Europe.

Thatcher also had an anti-european stand. She did not want to see power and control wrestled from Britain. She also reduced government responsibility for non-employment and increased emphasis on monetary policy. Her successors, John Major (1990-1997) and Tony Blair (1997 – 2007) continued advancing these policies, only that there was introduction of minimum wage. Collectively, these policies are what I refer to as Thatcherism.

Thatcher’s suggestions are not entirely applicable to Kenya. However Kenya can learn a few lessons, translated as solutions. To begin with, Kenya must allow more interaction of the forces of demand and supply. The government must also re-align the power balance between businesses and trade unions. It calls for re-evaluating all labour laws, i.e Employment Act, Labour Relations Act, Labour Institutions Act among others. Economic reasons must be the guide for making industrial relations decisions rather than purely on social reasons.

The strength of trade associations and peak organizations needs to be evaluated so that businesses present a united position on economic issues affecting them. A fragmented business organizational structure means that individual businesses represent themselves in matters of governance.

These are some suggestions both the national and county governments can implement. The desired end being a just and prosperous nation for all Kenyans.


Wednesday, October 2, 2013

Business and Human Rights in Kenya