Radio Africa Group is in a spot for not remitting employee Sacco deductions for the last seven months, which has forced Queenway Sacco to limit the amount of loans they are qualified to take.
Business Today is in possession of a letter from the Sacco informing staffers at The Star Publications Ltd, the publishing arm of Radio Africa, that the company has not forwarded their deductions for seven months, including November this year.
The revelation has caused disquiet at Lion’s Place with sources indicating the media house, which is going through lean times, could also have defaulted on remission of other statutory deductions to Kenya Revenue Authority, National Hospital Insurance Fund and National Social Security Fund.
The financial doldrums at Radio Africa saw the company last year introduce a tea vending machine which allocates a certain amount of tea and sugar to each employee at the rate of one cup per person per day.
It also embarked on a staff rationalisation programme that saw several employees edged out but the exercise was halted following protests over the crude manner in which it was being executed.
The situation has been made worse by failure by government to remit advertising revenue and, perhaps, it may have played a role in Head of Content David Makali’s decision not to renew his contract. He is set to leave tomorrow at the expiry of his one-year contract.
Interestingly, Chief Operating Officer Caroline Mutoko was also reassigned as general manager, which is considered to have been a demotion.
In September, the Star in an article protested at the failure by the Government Advertising Agency to remit ad payments to media houses amounting to Ksh 2.5 billion.
“The state’s claim that it was spending way too much on advertising and wanted to cut costs sounded less like prudence than a strategy to hit back at a vibrant media that sometimes gives the government a b****y nose. Three years after formation of the GAA, these fears linger. The agency owes the media Sh2.5 billion in advertising debts. This is a huge sum. Media houses are struggling to stay alive. Hiring and expansion have all but come to a halt. Journalists are staring at job losses while fresh graduates from the growing number of media schools have no realistic chance of getting a job,” the article by Henry Makori, the English Edition Editor of Pambazuka News, read in part.
In the letter to The Star employees, Queensway Sacco says the failure to remit deductions, which range from Ksh 3,000 to Ksh 10,000 per month will affect growth of their deposits, loan repayments, dividends, interest and access to various facilities it offers.
“Therefore, against all its will, the Sacco has no option but to limit all transactions with you, as an employee of TSPL until your employer clears all arrears relating to your account with the Sacco. From now, you will access products and services of the Sacco (loans, dividends, etc), based on only the amounts that have actually been received. Your employer had been informed, in good time, that the Sacco was thinking of taking this decision if the monies owed were not to be received by 20.11.2018 (now past),” writes Kiptoo Kiplangat, an accountant at Queensway Sacco.