Government commits to enhancing social welfare for informal sector workers

The Government recognises the crucial role played by the informal sector in the country’s economy and is committed to improving the social welfare of all workers in the sector,the Cabinet Secretary for Labour and Social Protection, Dr. Alfred Mutua has said.

Dr. Mutua stated that the government has created a comprehensive manifesto for the Bottom-Up Economic Transformative Agenda (BETA), aimed at enhancing the socio-economic welfare of Kenyans.

The CS said, “The manifesto recognises that the informal sector is at the core of economic development. It contributes approximately 33.8% to the GDP.”

The CS made the remark at a Nairobi hotel, during the launch of the South-South Cooperation Project dubbed ‘Extending Social Protection to Workers in the Informal Economy in Lao PDR and Kenya while Leveraging Digital Transformation through South-South Cooperation’.

The project aims at improving the welfare of workers in the informal sector while leveraging on digital technology. It is a partnership between the Ministry of Human Resources and Social Security (MoHRSS) of China and the International Labour Organisation (ILO) that aims to address social protection expansion challenges, through a collaborative project, focusing on improving social protection for workers in the informal economy.

The initiative seeks to leverage South-South cooperation to enhance policy design, administrative governance, and operational efficiency in social protection systems.

He said “cooperation between the two entities will bring substantial experience and proven strategies to this project with the ultimate aim of expanding Social Protection to the unreached in society in Kenya.”

Mutua said the government intends to ensure that informal workers have the same rights as formal workers by building a comprehensive framework to extend social protection coverage to workers in the informal and rural economies.

Dr. Mutua stated that approximately 3.9 million workers in Kenya are in the formal economy, while around 16 million are engaged in the informal economy.

 “There are more than 5 million informal enterprises in the country, alongside an additional 6.4 million households relying on agriculture for their livelihoods,” he noted that

“I am reliably informed that in Kenya, around 3.9 million workers are in the formal economy, whereas approximately 16 million are active in the informal economy. Further, we take cognizance that the informal enterprises in Kenya are estimated to be more than 5 million, with an additional 6.4 million households in the country, practicing agriculture to earn their livelihoods on an informal basis.”

Mutua regretted that the informal economy in Kenya faces significant challenges due to low social protection coverage.

 “The exclusion from social protection has left informal sector workers vulnerable to risks like illness, disability, and climate-related shocks, preventing them from accessing essential benefits,” he added.

Mutua expressed his gratitude to the International Labour Organisation and the Government of China for their significant support to the Kenya, noting that their provision of resources and technical assistance is crucial for extending social protection to informal economy workers, particularly through the development of a strategy aimed at reaching the underserved “missing middle” in society.

Mutua announced that his Ministry, in collaboration with China’s Ministry of Human Resources and Social Security (MoHRSS) and the International Labour Organisation (ILO), is addressing challenges in expanding social protection.

The joint project, Mutua said, will focus on improving support for informal economy workers in Kenya and Lao PDR, while promoting the Global Development Initiative through South-South and Triangular Cooperation.

He said the initiative aims to enhance policy design, governance, and operational efficiency in social protection systems.

Mutua emphasized that the partnership will bring valuable experience and proven strategies, ultimately seeking to extend social protection to underserved populations in Kenya.

Vice Minister of Human Resources and Social Security of China, Li Zhong, China, through the Ministry of Human Resources and Social Security, in collaboration with the International Labour Organisation, has been jointly carrying out South-South cooperation projects with a donation amount of US$8.4 million.

Li Zhong added that the effort has strengthened the capacity building of public service institutions and personnel and promoted the digital transformation of the labour market, which has contributed to promoting the coordinated economic and social development and poverty eradication of recipient countries.

He divulged that the South-South Cooperation Social Security Project launched will expand the scope of assistance to Africa, which he added will bring new opportunities and results to China-Africa cooperation and the cooperation between his ministry and the International Labour Organisation.

The Vice Minister said the South-South Cooperation Social Security Project will strengthen the social security policy formulation and management capabilities of recipient countries, promote social security agencies to use digital technology to improve service levels, and expand the social security coverage of informal economy workers.

“Kenya and Laos, the two main implementing countries of the project, will focus on strengthening social security cooperation with other African and ASEAN countries.”

The Principal Secretary, State Department of Labour and Skills, Shadrack Mwadime, said the social protection launch has been achieved through government strategies and policies, partnerships, and collaborations both regionally and globally.

“The sense of collaboration speaks volume of our efforts in ensuring that the workers are aided in identifying opportunities and linkages for their dynamic social protection when they are active in employment.

Mwadime said that through the Ministry’s support and service delivery, the workers welfare will be achieved through a continued partnership.

Principal Secretary, State Department of Social Protection, Joseph Motari, said the government is in the process of establishing a comprehensive database for informal workers with a view to enhancing their welfare.

The PS said the initiative is timely and marks an important milestone in the collective journey towards achieving better social welfare provision for workers.

He said, “We have developed an implementation matrix, and I believe its strategy is timely and will ensure no one is left behind.”

ILO Director, Tanzania Country Office, Dar-es-Salaam, Caroline Mugalla, emphasized the project’s significant component on digital transformation of social protection systems for improved efficiencies and delivery systems, which fully aligns with the Kenyan Government’s ambition.

Adding “Kenya has been a leader globally in the digital space with innovative approaches such as mobile money transfers and Single Registry for social protection, and we continue to applaud these ground-breaking advancements. Integration of mobile money transfers in contributory social protection schemes has led to dynamic and flexible payment methodologies, which have enhanced engagement of workers in the rural and informal economy.”

She, however, said much needs to be done to support the shift towards digital technologies and enhanced data